Improvement in the credit appraisal process, upturn of the business cycle, new initiatives for resolution of NPLs (including promulgation of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act), and greater provisioning and write-off of NPLs enabled by greater profitability, have kept incremental NPLs low.
Competition and efficiency In consonance with the objective of enhancing efficiency and productivity of banks through greater competition - from new private sector banks and entry and expansion of several foreign banks - there has been a consistent decline in the share of public sector banks in total assets of commercial banks.