Investigating the impact of Green Banking initiatives on Private Sector Bank

This study examines the determinants of profitability in Indian private sector banks using panel data from 13 banks listed on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) over the period 2013–2022. Panel Least Squares Regression with Return on Assets as the measure of financial performance. Our analysis reveals that revenue diversification through non-interest income and cost efficiency, measured by operating expenses relative to total funds, are the strongest drivers of bank profitability. Traditional credit-risk variables such as gross non-performing assets and liquidity indicators show limited statistical significance in explaining profitability variations. These findings highlight that Indian private sector banks prioritizing income composition management and cost discipline achieve superior financial performance compared to those relying primarily on asset quality metrics. The results have implications for bank strategy and management in the Indian banking sector, suggesting that operational efficiency and revenue mix warrant greater emphasis in performance optimization.