Abstract: Public Sector Banks (PSBs) in India have undergone significant consolidation since 2017 to address persistent Non-Performing Assets (NPA) crises that peaked at 11.2% of gross advances in 2018. This research evaluates the pre- and post-merger performance of six major PSBs (State Bank of India, Bank of Baroda, Punjab National Bank, Canara Bank, Indian Bank, and Union Bank of India) using the CAMEL framework over a 10-year period (5 years pre-merger and 5 years post-merger). Using descriptive statistics, ratio analysis, and paired t-tests, this study examines whether bank consolidation effectively improved asset quality, capital adequacy, management efficiency, earnings, and liquidity. Key findings reveal statistically significant improvements across all CAMEL dimensions post-merger, with Gross NPA ratios declining by 2-4.5 percentage points, Capital Adequacy Ratios increasing by 2.5-4.2 percentage points, and Return on Assets more than doubling for most banks. The analysis validates consolidation as a viable strategic tool for strengthening PSBs, though sustained improvements require complementary reforms in credit appraisal, governance, and NPA resolution mechanisms. This study contributes to empirical evidence on merger effectiveness in emerging-market banking and provides actionable insights for policymakers and bank management.

Keywords: Non-Performing Assets (NPA), Bank Mergers, Public Sector Banks, CAMEL Model, Asset Quality, Capital Adequacy, Post-Merger Performance, Indian Banking Consolidation, Financial Performance, Risk Management.