CSR EXPENDITURE AND FINANCIAL PERFORMANCE OF INDIAN BANKS: EVIDENCE FROM PUBLIC AND PRIVATE SECTOR BANKS

DOI: https://doie.org/10.65985/APER.2026941857

Authors:

Tanisha Kumari Singh, Prof. Kranti Singh, Shalini Anguria, Saumya Trivedi

Keywords:

Corporate Social Responsibility, Financial Performance, Banking Sector, ROA, ROE, EPS, Indian Banks

Abstract:

Corporate Social Responsibility (CSR) has become a strategic instrument for augmenting corporate reputation and stakeholder value, especially within the banking industry. This research investigates the influence of CSR expenditures on financial performance through a comparative analysis of public sector bank (State Bank of India) and a private sector bank (HDFC). This research is conducted using secondary data from F.Y 2015-16 to 2024-2025, employing correlation analysis and multiple regression techniques to interpret the connection between CSR expenditure and essential financial performance indicators, especially Return on Asset (ROA), Return on Equity (ROE) and Earnings per share (EPS). The study confirms that CSR spending has a statistically significant positive effect on EPS for both SBI and HDFC Bank, indicating that CSR initiatives contribute to enhanced shareholder value. However, the correlation between accounting-based profitability measures (ROA, ROE and EPS) and CSR varies among banks. The results further highlight that SBI exhibits a stronger and sustained positive linkage between CSR expenditure and financial performance compared to HDFC Bank. These results imply that the financial outcomes of CSR initiatives are bank-specific and can change depending on institutional traits and strategic orientation. The study contributes to the existing CSR literature and provides empirical evidence from the Indian banking sector and offers useful information for policymakers, bank management, and stakeholders regarding the strategic role of CSR investments.

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