Purpose: The present study aims to examine the financial performance before and during the COVID-19 pandemic with respect to profitability ratios, liquidity ratios, solvency ratios and economic value added (EVA) of select Indian public sector banks listed in the Bombay Stock Exchange (BSE).

Design/Methodology/Approach: In total, 12 public sector banks listed on the BSE were chosen for the analysis, which spans the years 2018–2019 to 2019–2020. Financial statements and monthly closing prices of public sector banks are the data that were gathered for this study. The tools used in this study are as follows: (1) EVA, (2) financial ratios, (3) descriptive statistics, (4) Shapiro–Wilk normality test and (5) paired samples t-test. Findings of the study are as follows: The empirical findings of the study revealed that the COVID-19 pandemic has a negative effect on earnings per share, net profit ratio, return on capital employed, return on asset and return on equity and a positive effect on current ratio, debt to equity ratio and EVA of select public sector banks.

Research Limitations/Implications: The findings of this study provide several avenues for more research. As one of the research ramifications, future researchers would need to explain discrepancies in the statistical findings of various academics in the finance field.

Social Implications: As the expansion of the banking industry is correlated with India’s economic growth, developing nations like India rely on the accuracy of the information. With the information provided, the COVID-19 pandemic has a negative effect on profitability variables and positive effect on liquidity, solvency and shareholder’s wealth creation variables, so that it has no serious harmful consequences on the economy in respect to profitability position of select banks.

Originality/Value: The study is conducted on the financial performance before and during the COVID-19 pandemic with respect to profitability ratios, liquidity ratios, solvency ratios and EVA of select Indian public sector banks listed in BSE and also highlighted how banks adapted the pandemic situation, which is a new phenomenon.

Economic value added, shareholders wealth, financial ratios, COVID-19 pandemic and paired samples t-test

Alarifi, A. A., & Husain, K. S. (2023). The influence of Internet banking services quality on e-customers’ satisfaction of Saudi banks: Comparison study before and during COVID-19. International Journal of Quality & Reliability Management, 40(2), 496–516.

Al-Hroot, Y. A. (2016). The impact of mergers on financial performance of the Jordanian industrial sector. International Journal of Management & Business Studies, 6(1), 2230–9519.

Alsamhi, M. H., Al-Ofairi, F. A., Farhan, N. H., Al-Ahdal, W. M., & Siddiqui, A. (2022). Impact of Covid-19 on firms’ performance: Empirical evidence from India. Cogent Business & Management, 9(1), Article 2044593.

Atayah, O. F., Dhiaf, M. M., Najaf, K., & Frederic, G. F. (2022). Impact of COVID-19 on financial performance of logistics firms: Evidence from G-20 countries. Journal of Global Operations and Strategic Sourcing, 15(2), 172–196.

Benaraba, C. M. D., Bulaon, N. J. B., Escosio, S., Narvaez, A. H. G., Suinan, A. N. A., & Roma, M. N. (2022). A comparative analysis on the career perceptions of tourism management students before and during the COVID-19 pandemic. Journal of Hospitality, Leisure, Sport & Tourism Education, 30, 100361. https://doi.org/10.1016/j.jhlste.2021.100361

Bobade, P., & Alex, A. (2020). Study the effect of covid-19 in Indian banking sector. JournalNX, 179–184. https://www.neliti.com/publications/336056/study-the-effect-of-covid-19-in-indian-banking-sector

Daniya, A. A., Onotu, S., & Abdulrahaman, Y. (2016). Impact of merger and acquisitions on the financial performance of deposit money banks in Nigeria. Arabian Journal of Business and Management Review, 6(4), 1–5.

Daryanto, H. K., & Sasongko, H. (2019). The effect of financial ratio, EVA and exchange rate on stock return in fishery subsector. Asian Journal of Business and Management, 7(1). https://doi.org/10.24203/ajbm.v7i1.5720

Das, R. (2015). Liquidation of cooperative banks in India: Implications of performance indicators for liquidation. ACRN Oxford Journal of Finance and Risk Perspectives, 4(4), 1–22.

Demirgüç-Kunt, A., Lokshin, M., & Torre, I. (2020). The sooner, the better: The early economic impact of non-pharmaceutical interventions during the COVID-19 pandemic (Policy Research Working Paper, 9257). World Bank. https://openknowledge.worldbank.org/server/api/core/bitstreams/1330ec71-45f8-51b8-9b2d-99b71cfff84c/content

Duggal, N. (2015). Post-merger performance of acquiring firms: A case study on Indian pharmaceutical industry. International Journal of Research in Management and Business Studies, 2(3), 24–28.

Foglia, M., Addi, A., & Angelini, E. (2022). The Eurozone banking sector in the time of COVID-19: Measuring volatility connectedness. Global Finance Journal, 51, 100677. https://doi.org/10.1016/j.gfj.2021.100677

Fraser, L. M., Ormiston, A., & Mukherjee, A. K. (2016). Understanding financial statements. Pearson.

Gazi, M. A. I., Nahiduzzaman, M., Harymawan, I. M., Masud, A., & Dhar, B. K. (2022). Impact of COVID-19 on financial performance and profitability of banking sector in special reference to private commercial banks: Empirical evidence from Bangladesh. Sustainability, 14(10), 6260. https://doi.org/10.3390/su14106260

Gurbaxani, A., & Gupte, R. (2021). A study on the impact of COVID-19 on investor behaviour of individuals in a small town in the state of Madhya Pradesh, India. Australasian Accounting, Business and Finance Journal, 15(1), 70–92.

Handayani, R., & Zulyanti, N. R. (2018). Influence of earning per share (EPS), debt to equity ratio, (DER), return on assets (ROA) on share returns in manufacturing companies registered on BEI. Journal of Product Innovation Management (JPIM), 3(1), 615–620.

Harrison, J. S., Hitt, M. A., & Hoskisson, R. E. (1991). Synergies and post-acquisition performance: Differences versus similarities in resource allocations. Journal of Management, 17(1), 173–190.

Hasan, F., Bellenstedt, M. F. R., & Islam, M. R. (2023). Demand and supply disruptions during the Covid-19 crisis on firm productivity. Global Journal of Flexible Systems Management, 24(1), 87–105.

Jayaraman, A. R., Srinivasan, M. R., & Arunachal, R. (2014). Impact of merger and acquisition on the efficiency of Indian banks: A pre-post analysis using data envelopment analysis. International Journal of Financial Services Management, 7(1), 1–18.

Khan, M. A., Khan, M. I., Illiyan, A., & Khojah, M. (2021, September). The economic and psychological impacts of COVID-19 pandemic on Indian migrant workers in the Kingdom of Saudi Arabia. Healthcare, 9(9), 1152.

Kumar, V., & Kumar, S. (2021). Impact of Covid-19 on Indian economy with special reference to banking sector: An Indian perspective. International Journal of Law, Management & Humanities, 4(1), 12.

Mishra, P. K., & Mishra, S. K. (2023). Do banking and financial services sectors show herding behaviour in Indian Stock Market amid COVID-19 pandemic? Insights from quantile regression approach. Millennial Asia, 14(1), 54–84.

Nicola, M. O. (2020). Evidence based management guideline for the COVID-19 pandemic: Review article. International Journal of Surgery, 77, 206–216. https://doi.org/10.1016/j.ijsu.2020.04.001

Normasyhuri, K., Erisna, N., & Setiawan, P. A. (2023). The dynamic of Red Plate Bank’s financial performance before and during the pandemic. Jurnal REKSA: Rekayasa Keuangan, Syariah dan Audit, 10(1), 24–35.

Patel, F. (2015). Effects of accounting information system on organizational profitability. International Journal of Research and Analytical Reviews, 2(1), 168–174.

Patel, R. (2018). Pre & post-merger financial performance: An Indian perspective. Journal of Central Banking Theory and Practice, 7(3), 181–200.

Perwej, A. (2020). The impact of pandemic COVID-19 on the Indian Banking System. International Journal of Recent Scientific Research, 11(10), 39873–39883.

Rakshit, B., & Basistha, D. (2020). Can India stay immune enough to combat COVID-19 pandemic? An economic query. Journal of Public Affairs, 20(4), e2157.

Rhamadana, R. B., & Triyonowati, T. (2016). Financial ratio analysis to assess financial performance at PT HM Sampoerna Tbk. Journal of Management Science and Research (JIRM), 5(7).

Sahoo, P. B. B., & Thakur, V. (2023). Enhancing the performance of Indian micro, small and medium enterprises by implementing supply chain finance: Challenges emerging from COVID-19 pandemic. Benchmarking: An International Journal, 30(6), 2110–2138.

Singh, J., & Bodla, B. S. (2020). Covid-19 pandemic and lockdown impact on India’s banking sector: A systemic literature review. In COVID-19 pandemic: A global challenge (pp. 21–32). Aryan Publication.

Stewart, G. (1991). The quest for value. Harper Collins Publishers.

Stewart, G. (1994). EVA: Fact or fantasy? Journal of Applied Corporate Finance, 7(2), 71–84.

Tikasari, N., & Surjandari, D. A. (2020). The effect of economic value added and financial performance on stock return. Saudi Journal of Business and Management Studies, 5(6), 343–352.

Trivedi, K. (2021). Systemic risk in Indian banking: Measurement and impact of COVID-19. Economics & Applied Informatics, 27(1), 143–151.

Vulanovic, M. (2017). SPACs: Post-merger survival. Managerial Finance, 43(6), 679–699.

Weber, R. H., & Darbellay, A. (2010). Legal issues in mobile banking. Journal of Banking Regulation, 11(2), 129–145.