Indian banking sector has witnessed a great transformation due to introduction of prudential norms, liberalization and deregulation. With an advent of foreign players and increased participation of domestic private banks, banking sector has become more competitive than ever before. Banks are under pressure to maintain and improve their operational efficiency as measured in terms of ROI, ROE and EPS. In this paper an attempt has been made to explore the need and significance of these value based measures in the context of Indian banking sector. The study reflects that in the wake of globalization and changed global scenario shareholder wealth maximization is a very potent criterion to review the performance of banks. This paper discusses the need and significance of shareholder value creation in Indian banks in the backdrop of existing performance of the banks and inability of the traditional methods to measure the economic profitability of the banks.
Need and Significance of Shareholder Value Creation in Indian Banks
Journal of Accounting and Finance
Vol. 27 - No. 1