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This research report which looks into several key factors which affect the financial performance with reference to profitability of Indian banking sector considering econometric approach using regression model to identify which of the financial indicators will have implications and which do not have implications on the financial performance of bank, more specifically related to profitability. To identify the expected results from the actual results we have used econometric approach or model using internal financial values such as Return on Assets, Return on Capital, Income Growth Rate and Profit per Employee and also used external factors such as GDP growth rate of 83 Scheduled Commercial Banks in three different sectors that is public sector, private sector and foreign banks operating in India. Along with that we have also used the financial values and ratios obtained by Reserve Bank of India (RBI) and in analysis and interpretation of data those components are comprehensively explained and highlighted through graphs and table.
