DETERMINANTS OF BANK PROFITABILITY AND PERFORMANCE: A CASE STUDY ON STATE BANK OF INDIA IN VISAKHAPATNAM

The current study attempts to identify the major factors determining the performance and profitability of the State Bank of India (SBI), which is the biggest public sector commercial bank in India. Using a mixed-methods empirical design, the study draws on secondary panel financial data and primary findings from surveys of branch managers in Visakhapatnam. The results show that internal operational drivers, including net interest income from credit lending and operational efficiency, are major triggers for profitability in institutions. Non-performing assets (NPAs) are, however, the major structural challenge to asset quality and return metrics such as ROA and ROE. From an external perspective, the major challenges are macroeconomic instability, the interest rate environment, and regulations from the Reserve Bank of India (RBI). The analysis shows that digital transformation strategies, along with portfolio diversification through entry into high-yielding retail portfolios and fee-based advisory services, reduce operational costs considerably while stabilizing revenues. These findings suggest that SBI should prioritize operational efficiency, NPA control, digital transformation, and revenue diversification to strengthen profitability in practice and improve performance.

Keywords

banks, non-performing assets, state bank of india, and asset quality.

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To cite this article

Ande Keerthi Kailash Nath Babu, & Sudheesh P. N. (2026). Determinants of Bank Profitability and Performance: A Case Study on State Bank of India in Visakhapatnam. Sparkling International Journal of Multidisciplinary Research Studies, 9(3), 1-8.