Banks play a crucial, functional and dynamic role in every nation's economy at a greater extent as a financial intermediary. Indian banking sector also contributes to the economic growth and development of the country. Banks channelize the funds from surplus units to deficit units for productive purposes also helps the government in formulating financial policies. The traditional activities of a bank were lending and borrowing money but due to many factors banking sector have been extending its operations and involving in all sorts of modern financial services depending upon socio-economic conditions of an economy. Therefore, the banking sector can be considered as high-priority constituent in Indian financial service sector. But during the post-reforms period, Indian banking industry had witnessed decline in operational efficiency and that led to decrease in profitability, productivity and efficiency due to several reasons. Some specific reasons may be considered as foreign direct investment, various credit programs and credit sanctioning policies, mechanisms etc. and due to these banks’ efficiency was deteriorated. Because of all these reasons banks affected the cost side and health of banks, and the most alarming issue was quality of assets. To address this, issue several reforms were formulated and implemented but still this problem of Non-performing assets (NPAs) not completely resolved. Banking reforms formulated prudential norms focusing on asset classification, income recognition and provisioning in order to improve the efficiency of the banks. NPAs became a significant area of concern for the banking sector. As of 31st March 2018, gross NPAs stood at Rs. 10.35 lakh crores, out of which 85% arises by the loans assets given by public sector banks and expecting rise in the volume of NPAs in the years to come. Due to changing dynamics of the business environment, it is very essential to make a periodic assessment of NPAs to know the exact reasons and there is a need for re-engineering the banks. Keeping this present scenario into account, this research paper has been made an attempt to examine the status of NPAs and its impact on operational efficiency and profitability by considering all public sector, private sector banks and foreign banks established in India, based on statistics during the post-millennium period. This paper considers the aggregate data of the three sectors banks in order to examine the differences between three groups of banks with regard to NPA management from the financial year 2007-08 to 2018-19.