Abstract Paper
| Title | : Financial performance analysis of selected public and private banking sectors in Tamilnadu |
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| Author(s) | : Sasikumar S, Karthikeyan V |
| Article Information | : Volume 11 - Issue 1 (June - 2026) , 134-142 |
| Affiliation(s) | : PG & Research Department of Management Studies, Sacred Heart College (Autonomous), Tirupattur - 635 601 |
| : PG & Research Department of Management Studies, Sacred Heart College (Autonomous), Tirupattur - 635 601 |
Abstract :
The banking sector plays a vital role in economic development through financial intermediation, credit creation, and resource mobilization. The increasing competition between public and private sector banks has necessitated continuous evaluation of financial performance to ensure operational sustainability and competitiveness. This study investigates the financial performance of selected public and private sector banks in Tamil Nadu by examining the influence of Profitability, Asset Quality, Operational Efficiency, and Capital Adequacy on overall Financial Performance. Primary data were collected from 150 respondents comprising banking professionals, customers, and financial experts using a structured questionnaire. The study employed Confirmatory Factor Analysis (CFA) and Structural Equation Modeling (SEM) using SPSS AMOS to validate the measurement and structural models. The CFA results confirmed the reliability and validity of the constructs through satisfactory factor loadings, Composite Reliability, Average Variance Extracted, and discriminant validity measures. The SEM results revealed that Asset Quality, Profitability, Operational Efficiency, and Capital Adequacy significantly influence Financial Performance. The structural model demonstrated excellent fit indices (χ²/df = 2.429, GFI = 0.934, AGFI = 0.915, CFI = 0.962, TLI = 0.957, RMSEA = 0.048). The model explained 76% of the variance in Financial Performance. Among the predictors, Asset Quality emerged as the strongest determinant followed by Profitability. The findings emphasize the importance of effective credit risk management, profitability enhancement, operational excellence, and adequate capitalization in improving banking performance. The study provides valuable insights for policymakers and banking executives in strengthening the competitiveness and sustainability of banking institutions in Tamil Nadu.
| Keywords | : Financial Performance, Public Sector Banks, Private Sector Banks, Asset Quality, Profitability, Capital Adequacy, Operational Efficiency, Structural Equation Modeling. |
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| Document Type | : Research Paper |
| Publication date | : June 18, 2026 |