Retail Credit Risk Management in Commercial Banks in India with special reference to Public Sector Bank

In the globalization era Financial Institutions and Banks have a special place in the economy. In Indian banking system have face the serious problems due to Non- performing assets in the last decade. While the main function of banks is to lend funds as loans to different sectors such as agriculture, trade, personal loans, housing loans etc., In recent times the banks have become very careful in granting loans because of increasing rate of non-performing assets (NPAs).The objective of the credit risk management is not only to prevent risk taking, but to ensure that the risks are consciously taken with understanding and full knowledge for that they can be mitigated. The purpose of managing credit risk is to prevent a financial institution to fail of materially damage and its competitive position. This study includes both primary and secondary data. Firstly the study examined the trend of gross advances, total assets, gross NPAs, ratio of gross NPAs to Gross Advances, and ratio of gross NPAs to total assets. The study observed that the gross NPAs of public sector banks have depicted an increased trend over the period of study. It is found on the basis of analysis of data that the asset quality of public sector banks mixed improved in the past few years as reflected in the decline in the ratios i.e. gross NPAs as percentage of gross advances, and but same effect on gross NPAs as percentage of total assets.