Indian Public Sector Banks Achieve Record Net Profit of Rs 1.41 Lakh Crore for FY24
Click to start listening
New Delhi, Dec 15 (NationPress) Public Sector Banks (PSBs) in India have achieved a remarkable net profit of Rs 1.41 lakh crore for the financial year 2023-24, marking their highest ever, according to an announcement by the Ministry of Finance on Sunday.
The gross non-performing assets (GNPA) ratio has significantly decreased, falling to 3.12 percent as of September 2024. Maintaining this positive trend, these banks reported a net profit of Rs 85,520 crore in the first half of 2024-25.
In addition to their impressive financial performance, PSBs have made substantial contributions to shareholder returns, distributing a total dividend of Rs 61,964 crore over the last three years. This exceptional financial growth highlights the sector’s operational efficiency, enhanced asset quality, and stronger capital foundations.
Moreover, these banks have been pivotal in advancing financial inclusion.
They have successfully implemented important government initiatives, including the Atal Pension Yojana and Pradhan Mantri Jeevan Jyoti Bima Yojana, among others.
A significant turning point occurred in 2015 when the Reserve Bank of India (RBI) launched the Asset Quality Review (AQR). This initiative was designed to uncover and rectify concealed stress within banks by enforcing the transparent acknowledgment of NPAs.
The review also reclassified previously restructured loans as NPAs, leading to a notable surge in reported NPAs. The increased provisioning requirements during this time affected the financial metrics of banks, limiting their capacity to lend and support productive sectors of the economy, according to the ministry.
Another indicator of the enhanced resilience of PSBs is their Capital to Risk (Weighted) Assets Ratio (CRAR), which climbed by 3,983 basis points to 15.43 percent in September 2024, up from 11.45 percent in March 2015.
Notably, this CRAR significantly surpasses the Reserve Bank of India’s (RBI) minimum requirement of 11.5 percent, reinforcing the improved financial health of these institutions.
In summary, Public Sector Banks in India have made extraordinary progress in recent years, attaining unprecedented financial achievements and playing a crucial role in the nation’s economic stability and growth.
