Deposits And Advances As Key Drivers Of Profitability: A Study Of UCO Bank In The Indian Public Sector Banking Context.

Abstract

In the dynamic landscape of Indian public sector banking, profitability remains a critical measure of operational efficiency and financial health. This study investigates the influence of total deposits and total advances on the net profitability of UCO Bank from fiscal year 2016 to 2025. Drawing on secondary financial data, the analysis employs descriptive statistics, Pearson correlation coefficients, and simple linear regression to uncover patterns and relationships. Results indicate strong positive correlations between deposits, advances, and net profit, with advances emerging as a particularly potent driver of earnings. However, the regression highlights nuances, such as potential cost implications of deposit growth when isolated from lending activities. These findings underscore the need for balanced growth strategies in deposits and advances to sustain profitability amid regulatory pressures and economic shifts in India. The paper contributes to understanding how core banking operations fuel recovery and growth in public sector banks post the non-performing asset crisis.