Comparative Study of Public and Private Sector Banks in India: Analysis of CAMEL and DEA Approach
Keywords:
CAMEL approach, DEA Approach, Public and Private Sector Banks, Financial StabilityAbstract
The objectives of this paper are to analyze the soundness and to measure the efficiency of 12 public and private sector banks based on market cap. CAMEL approach has been used over a period of twelve years (2000-2011), and it is established that private sector banks are at the top of the list, with their performances in terms of soundness being the best. Public sector banks like Union Bank and SBI have taken a backseat and display low economic soundness in comparison. DEA results exhibit that among the public sector banks, the performance of Bank of India, Canara Bank and Punjab National Bank got dampened in the last two years under study where as among the private sector banks, except Axis Bank which was not found to be satisfactory at all, the remaining private sector banks shows marked consistency at their efficiency level during the period under study.
