Sreejata Banerjee | Central University of Tamil Nadu (original) (raw)

Sreejata Banerjee

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Papers by Sreejata Banerjee

Banking crisis have serious repercussion causing loss of household savings and decline in confide... more Banking crisis have serious repercussion causing loss of household savings and decline in confidence and soundness in the banking sector. The present study is an attempt to analyze this aspect in light of the challenges of financial sector reforms faced by banks in India . Stress test of banks operating in India is under taken to identify factors that adversely influence banks’ non-performing assets (NPA) which is the key indicator of banks’ soundness. We examine the response of bank’s NPA to unexpected shocks from external and domestic macroeconomic factors namely interest rate, exchange rate, GDP. NPAs are regressed in Vector Auto Regressive model on a set of macroeconomic variables with quarterly data from 1997 to 2012 to examine whether there is divergence in the response across the four types ownership: public, old private new private and foreign. Granger Causality, IRF and FEVD are used to verify the VAR results. Interest rate significantly impairs asset quality for all banks in two-way causality. Exchange rate, net foreign institutional investor flow and deposits Granger cause public banks’ NPA. GDP gap Granger cause old private and foreign banks. IRF show banks are vulnerable to inflation shock requiring 8 quarters to stabilize. Clearly the stress test demonstrates that all banks need to re-capitalize and improve asset quality.

This paper evaluates the twin objectives of profitability and stability of banks operating in Ind... more This paper evaluates the twin objectives of profitability and stability of banks operating in India between 2000 and 2013. Cost-to-income ratio measures the banks’ logistic efficiency. Net Non-Performing Assets (NNPA) and the Capital Adequacy Ratio (CAR) measure soundness. Profitability is computed by Return on Equity and Return on Assets. The analysis is undertaken separately for banks of different ownership types – public sector banks, old private banks, new private banks and foreign banks. Random effects regression model estimates on the panel data for 75 banks reveal the conundrum banks face. NNPA and advances negatively influence RoE for PSBs and new banks. The smaller old private banks’ cautious policy helps them to competes well with new private banks and public banks. Foreign banks cautiously maintain high CAR and report high CIR. Each group faces the universal problem of profitability versus soundness. The high profit per employee in foreign banks indicates the effectiveness of their human resource policy. From the logistic angle, except for the new private banks the profit per employee negatively influences NNPA. And wages as percent of total expenses negatively affects NNPA for all banks except old private, thus ownership matters.

Indian commodity market: derivatives and risk …, Jan 1, 2010

Factors influencing banks across different ownerships in India for compliance with Basel I and II... more Factors influencing banks across different ownerships in India for compliance with Basel I and II are identified by applying random effect panel data and censored regression model. The credit risk focus of Basel I is revealed as private and foreign banks' compliance are affected by credit risk weighted assets, while public banks by credit deposit ratio, capital and ROA. Business per employee, profit per employee influence public and private banks, while advances and net non-performing assets affect foreign banks in India indicating the operational risk focus in Basel II. Buffer capital for countercyclical stance is positively related to ROA and negatively to credit deposit ratio.

Themes on development …, Jan 1, 2000