Profitability and Productivity in Indian Banks: A Comparative Study

The new millennium has brought along challenges and opportunities in the various fields of economic activities including banking. The entry of various private sector and foreign banks exposed the inefficiencies in the public sector banks. This paper compares various categories of banks on their productivity and profitability. While there is no remarkable difference in the spread ratio, there is a significant difference in Burden ratio among the public sector and private sector & Foreign banks. The key to profitability for the public sector banks is increased productivity. Those public sector banks that have been able to increase the productivity found themselves at par with the private sector banks.