Engineering

European Journal of Business and Innovation Research Vol.2, No.1, pp.93-105, March 2014 Published by European Centre for Research Training and Development UK (www.ea-journals.org)

FINANCIAL PERFORMANCE OF STATE AND PRIVATE SECTOR COMMERCIAL BANKS: A COMPARATIVE STUDY DURING WAR AND POST WAR SCENARIOS OF SRI LANKA Velnampy.T Professor, Dean/ Management Studies & Commerce University of Jaffna, Sri Lanka. Anojan.V Department of Accounting Faculty of Management Studies and Commerce University of Jaffna, Sri Lanka. Mobile- +94778394018

ABSTRACT: The purpose of this study is to compare the financial performance of state and private sector banks during war and post war scenarios of Sri Lanka. The banking sector is one of the major service sectors in Sri Lanka. Sri Lankan commercial banks can be divided into two major categories such as state and private sector commercial banks. The numbers of studies are done in all over the world to judge and evaluate the financial performance of their banking sector using different statistical methods such as Data Envelopment Analysis (DEA), CAMELS rating system and the Stochastic Frontier Approach (SFA). This study is initiated as a comparative study of financial performance of commercial banks in Sri Lanka using ratio, descriptive and independent samples T-Test analysis with private and state banks during war and post war scenarios in Sri Lanka from the financial year 2007-2012. Ratio and descriptive analysis are widely used for measuring and comparing the financial performance and position of banks. Accordingly descriptive analysis confirmed that, private banks had high financial performance than state banks during war, post war. State banks should focus to increase their financial performance to compete and survive successfully in the current world and also private commercial banks try to achieve their target financial performance for their long survival. KEYWORDS: Financial Performance, State & Private Sector Banks, During War,...