FINANCIAL HEALTH ASSESSMENT MODEL FOR SELECTED PRIVATE SECTOR BANKS USING FUZZY LOGIC

Abstract

An analysis of Indian banks' financial health has been steered using the Altman Z-score model, a widely recognized tool for predicting the likelihood of corporate bankruptcy. The model assigns a score based on various financial metrics, with lower scores indicating a higher risk of bankruptcy. A closer examination of City Union Bank, CSB Bank, Dhanlaxmi Bank, Tamilnad Mercantile Bank, and Yes Bank reveals trends and insights into their financial performance. Despite the model's indication of potential bankruptcy risk, the banks' improving trends and strengthening fundamentals suggest that the risk may be overstated. To gain a more comprehensive understanding of the banks' financial health, stakeholders are advised to consider industry-specific factors and supplementary metrics, such as non-performing assets and capital adequacy ratios. By taking a more nuanced approach, stakeholders can make more informed investment and risk management decisions.