Nationalised banks post lower RoA than private banks

According to a study, the return on assets (RoA) of nationalised banks was lower than that of private banks during 2010-13.

Further, state-run banks lost market share by 1.3 per cent over the last four years to private and foreign banks, the study shows.

Nationalised banks lost 0.5 per cent and SBI 0.8 per cent of the market share. As far as private sector banks are concerned, the new private banks (NPBs)gained market share by 1 per cent and the old private banks (OPBs) by 0.3 per cent between 2013 and 2010.

The nationalised banks are said to have lost market share largely in the deposits front rather than the advances front.

Thus, while PSBs have suffered in their market share both in the deposits and the advances front, the problem has been more acute on the deposit mobilisation front than credit disbursement.

Meanwhile, the study shows that banking business expanded 15 per cent in 2012-13 compared to 17.6 per cent in 2011-12 as real GDP growth decelerated from 6.2 per cent to 5 per cent.