Policy Interest Rate and Bank Profitability-Scheduled Commercial Banks in India

The main aim of this research study is to inspect the relationship between interest rate (monetary policy) and bank profitability, along with some specific, industry macroeconomic variables. methodology includes balanced panel data comprising 50 Indian scheduled commercial banks for 12 years from 2008 2020. Fixed effect random model regression have been used know required relationship. Due presence heteroskedasticity, results robust standard error presented. result shows a positive association spread two banks’ profitability indicator return on assets (ROA), equity (ROE) while has an insignificant negative profitability. concludes that central can increase or decrease maintain surplus deficit liquidity problem in economy. Banks are advised make appropriate change lending deposit respect policy transmission channel efficient. Also, identify other factors affect bank’s It will help manager improve