An Assessment of Credit Risk Management in Banks: A Case of the Nainital Bank Ltd.

Banks perform the function of financial intermediaries. The funds collected as deposits are deployed in advances to the borrowers and investments in government’s securities etc. The security of funds so advanced is a prime concerned of banks. The growth and economic development of a country depends upon the robust banking sector. Increasing NPAs have become the cause of concern for banks and Reserve Bank of India. Credit risk management has gained much importance these days. The Nainital Bank Limited, a subsidiary of Bank of Baroda a premier nationalized bank with a total business approximate Rs. 10,000 crores is functional in 5 states of the country, viz., Uttar Pradesh, Uttarakhand, Rajasthan, Haryana, and Delhi. The assessment of credit risk management practice and system of Nainital Bank has been investigated in this research paper. Risk capacity , risk appetite, rating wise distribution of standard advances and concentration risk have been analyzed through various ratio and graphical analysis.