IRJMST Vol 8 Issue 5 [Year 2017] ISSN 2250 – 1959 (0nline) 2348 – 9367 (Print) International Research Journal of Management Science & Technology http://www.irjmst.com Page 212 EARNING ABILITY OF PUBLIC SECTOR BANKS USING DEA Neha 1 , Dr. Gurcharan Singh 2 , 1 Research Scholar 2 Professor & Head of the department, E-mail: guru64@gmail.com E-mail: neha_kamboj2000@yahoo.com School of Management Studies, Punjabi University, Patiala-147002, India. Abstract Earning is a vital factor to find out the financial performance of a business. Earning ability principally measures the efficiency and productivity of the bank, explains the progress and perpetuation of future earnings capacity. Therefore, banks depend upon its earning to bring about the decisions related to maintaining sufficient capital levels, disbursing dividends, giving the opportunities for further outlays, increasing the business, maintaining the viable outlook and for Research & Development activities. The study exclusively aims to assess the earning ability of scheduled commercial public sector banks. The Descriptive Research Design would be appropriate. The research is purely based on Census as this technique leads to huge intensity of accuracy. It has been found that State Bank of Patiala has topped in earnings the income. The major competitors for State Bank of Patiala in the public banking sector were Corporation Bank, Syndicate Bank, Bank of Maharashtra Bank and Bank of India. However, in terms of average market share, State Bank of Patiala is by far the biggest player in the market. Whereas, Allahabad Bank and Indian Overseas Bank were ranked at last position as far as earning income is concerned. It also discussed about the earning scenario of public sector banks. This study will also helpful to policy making and regulatory agencies. Keywords: Banks, Earning Ability, Envelopment, Efficiency. 1. Introduction The banking sector in India plays a crucial role in the economy not only by mobilizing savings and channeling them into investments but also by contributing directly to GDP and generating employment (Reserve Bank of India, 2008). Banks serve as backbone to the financial sector, which facilitate the proper utilization of financial resources of a country. The banking sector has been subject to constant changes in the economic environment over the past two decades. From the beginning of the 1990s onward the banks needed to rebuild their balance sheets and reduce lending to firms in the face of growing bad loans originating from the burst of the asset bubble and the full-scale enforcement of Basel capital adequacy requirements. The financial system worsened when Japan suffered a banking crisis due to the collapse of Sanyo Securities and Yamaichi Securities, resulting in declining in banks‘ profit structures and balance sheets (Aoki,