Public sector banks' cumulative profit crossed the ₹1 lakh crore mark in the financial year ended March 2023, with market leader State Bank of India (SBI) accounting for nearly half of the total earnings, PTI reported.
In the latest March quarter, the PSBs' profit cumulatively increased more than 95% to ₹34,483 crore. In the year-ago period, the same was at ₹17,666 crore, the report said.
Analysts said that higher interest income and improvement in the management of non-performing assets or bad loans are among the key reasons for the improved profitability of the banks.
The journey of public sector banks (PSBs) has witnessed a significant turnaround, evident in their financial performance. After reporting a collective net loss of ₹85,390 crore in the fiscal year 2017-18, PSBs have made remarkable progress, with their combined profit reaching ₹1,04,649 crore in the fiscal year 2022-23, according to the report.
These 12 PSBs witnessed a 57% increase in total profit compared to ₹66,539.98 crore earned in 2021–22.
In percentage terms, Pune-based Bank of Maharashtra (BoM) had the highest net profit growth with 126% to ₹2,602 crore, followed by UCO Bank with a 100% rise to ₹1,862 crore and Bank of Baroda with a 94% increase to ₹14,110 crore.
However, in absolute terms, SBI has reported an annual profit of ₹50,232 crore in 2022–23, showing an increase of 59% over the preceding financial year, the report noted.
Except for the Punjab National Bank (PNB), other PSBs have reported impressive annual increases in their profit after tax.
Other lenders like Punjab and Sind Bank posted an annual profit growth of 26% ( ₹1,313 crore), Central Bank of India at 51% ( ₹1,582 crore), Indian Overseas Bank at 23% ( ₹2,099 crore), Bank of India 18% ( ₹4,023 crore), Indian Bank at 34% ( ₹5,282 crore) and Union Bank of India at 61% ( ₹8,433 crore), as per the report.
The reforms undertaken by the government over the last eight years addressed credit discipline, ensured responsible lending, and improved governance. Besides, there was the adoption of technology, amalgamation of banks, and the general confidence of bankers was maintained, the report said.
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