Meena Rani
Abstract:
The purpose of the study was to determine how return on Assets and non-interest revenue of a few chosen listed banks in India relate to one another. This current study will assist banks in determining how non-interest income affects their financial performance. The dependent variable/total assets (log), capital adequacy, interest income/total assets, and non-interest income/total assets were regarded as independent variables, while return on assets (ROA) was regarded as a financial performance indicator for the current study. To observe the link, both descriptive and analytical methods were used. The examination of the results shows that non-interest income has a detrimental impact on public sector banks' financial performance. Additionally, the study found that non-interest income improved private sector banks' financial performance. The impact of non-interest income on banks in the public and private sectors was negligible. Additionally, it is discovered that not all variables have an equal impact on financial performance. For private sector banks, the Return on Assets (ROA) was positively and significantly impacted by parameters such as Total Assets (Log), Interest Income/Total Assets, and Capital Adequacy Ratio. The Return on Assets (ROA) of public sector banks was positively and significantly impacted by parameters such as Total Assets (Log) and Capital Adequacy Ratio, whereas the influence of Interest Income/Total Assets was positively and minor. The findings showed that in order to improve their financial performance, banks should take into account the non-interest income components.
