Public Sector Banks in India Show Strong Growth in 2024-25
The Public Sector Banks (PSBs) in India have reported impressive growth in the first half of the financial year 2024-25. The Ministry of Finance announced that the total business of these banks reached Rs 236.04 lakh crore, marking an 11% increase compared to the previous year.
Growth in Credit and Deposits
The global credit and deposit portfolio of PSBs grew by 12.9% and 9.5% respectively, standing at Rs 102.29 lakh crore and Rs 133.75 lakh crore. The operating profit for this period was Rs 1,50,023 crore, a 14.4% increase, while the net profit was Rs 85,520 crore, showing a 25.6% rise.
Improvement in Financial Health
The Gross and Net Non-Performing Assets (NPA) were reported at 3.12% and 0.63%, showing a decline of 108 basis points and 34 basis points respectively. The Capital-to-Risk Weighted Assets Ratio (CRAR) was 15.43%, exceeding the regulatory requirement of 11.5%.
Adoption of New Technologies
PSBs are making significant progress in adopting technologies like Artificial Intelligence, Cloud, and Blockchain. They are also enhancing digital infrastructure and implementing systems to manage cybersecurity risks.
Meeting Chaired by Finance Minister
Union Finance Minister Nirmala Sitharaman chaired a meeting with PSB Chief Executives to discuss current and emerging issues. The ministry highlighted that reforms and regular monitoring have improved credit discipline, governance, and financial inclusion, contributing to the robust health of the Indian banking sector.
Doubts Revealed
Public Sector Banks -: Public Sector Banks are banks owned by the government. In India, these banks are controlled by the government and provide various financial services to the public.
Financial Year 2024-25 -: A financial year is a period used for calculating annual financial statements. In India, it starts on April 1st and ends on March 31st of the next year. So, the financial year 2024-25 means from April 1, 2024, to March 31, 2025.
Rs 236.04 lakh crore -: This is a very large amount of money. In India, ‘lakh’ means 100,000 and ‘crore’ means 10 million. So, Rs 236.04 lakh crore is a huge sum of money that shows the total business done by the banks.
Ministry of Finance -: The Ministry of Finance is a part of the government of India responsible for managing the country’s finances, including the budget, taxes, and financial institutions.
NPAs -: NPA stands for Non-Performing Assets. These are loans or advances that are not being repaid by borrowers, which can be a problem for banks.
Regulatory Capital Requirements -: These are rules set by financial authorities that require banks to hold a certain amount of money to cover potential losses and ensure stability.
Nirmala Sitharaman -: Nirmala Sitharaman is an Indian politician who is the current Finance Minister of India. She is responsible for managing the country’s economic policies and financial matters.
