International Research Journal of Education and Technology

Profit is the main concern to start out any business organization. Like all other businesses, banks are also run with the motive of earning profit. Banks are indulged with the activity of deposits and borrowings. Non-Performing Assets are those part of assets that are associated with the bank‟s borrowing activities. A high NPAs indicates that the number of credit defaulters is high in a particular bank which directly affects the profitability, liquidity, and solvency of that bank and also disservice the value of assets. The problem of NPAs does not only affect the banking sector but also the economy of a concerned country. A high NPAs is a direct indication of the poor financial health of a concerned bank. The Indian banking sector is facing the higher NPAs problem for a decade now. The magnitude of NPAs is relatively high within the public sector banks. To strengthen the profitability and efficiency of the banking system the level of NPAs needs to be lower down and controlled.This paper touches upon the meaning and therefore the definition of a non-performing asset, the conceptual framework of non-performing assets, classification of loan assets and provisions. This paper would evaluate the adverse effect of non-performing assets on the return on total assets of Punjab National Bank Limited for the period2013 to 2015, 2016-17, and 2019-20.

Keywords: Non-Performing Advance, Economy Development, Lending, Prudential Norms, Return on Total Assets, Banking Sector.