Abstract:
The banking system, which constitutes the core of the financial sector, plays a crucial
role in transmitting monetary policy impulses to the entire economic system. Its
efficiency and development, therefore, are vitalfor enhancing the growth and improving
the chancesfor price stability'. In view of the importance of improving the profitability
performance of the banking sector in recent years, a census study has been adopted by
covering all Indian scheduled commercial banks in India which have been divided
into three groups, namely, SB I group. Nationalised Banks group and Private Banks
group with two sessions viz., Period 1 and Period II by dividing the 10 years study
period into firstfive years and last five years. Hie scope of the study is wider in nature.
Vie study identified certain factors, which are prominent to hike the profitability of the
banks. The step-wise multiple regression has been adopted by the researcher. An
analysis ofthe SBIgroup reveals that in both the period ofstudy, the variable provisions
and contingencies to total expenses showed a prominent place.. The nationalized
banks group showed a position of provisions and contingencies to total expenses in
the first halfof the study period and Capital A dequacy Ratio during the second halfof
the study period. In relation to the Private Banks group, it has changed from Other
interest expenses ratio to Capital Adequacy ratio. The study makes emphasis with
regard to initiating monitoring and controlling mechanism on certain important ratios
which are inevitable one to enhance the profitability of scheduled commercial banks.
