PSBs' gross NPAs drop to 3.12% from 14.58% in 2018

Net profit of Public Sector Banks (PSBs) rose 34%, achieving a record-breaking ₹1.41 lakh crore in FY 2023-24, compared to ₹1.05 lakh crore last year, the Ministry of Finance data shows.

The gross NPAs (non-performing assets) of PSBs declined to 3.12% in September 2024, a sharp decline from 14.58% in March 2018. The government noted the improvement is attributed to the 4R strategy. “Since 2015, the government implemented a comprehensive 4R’s strategy of recognising NPAs transparently, Resolution and Recovery, Recapitalising PSBs, and Reforms in the financial system to address the challenges faced by PSBs.”

The capital to risk-weighted assets ratio (CRAR) of PSBs rose 15.43% in September 2024, an improvement of 393 bps (basis points) from 11.45% in March 2015.

The number of PSB branches rose to 1,60,501 in September 2024 from 1,17,990 in March 2014. Out of these, 1,00,686 branches are in rural and semi-urban areas. 

PSBs have expanded their outreach, operating 1,60,501 branches nationwide, with 62.7% located in rural and semi-urban areas, thereby advancing financial inclusion. “The gross advances of Scheduled Commercial Banks grew from ₹8.5 lakh crore to ₹61 lakh crore during 2004-2014, which has significantly increased to ₹175 lakh crore in Mar-2024.” 

The government also informed the credit to the MSME sector grew by 17.2% in March 2024, with total advances reaching ₹28.04 lakh crore.

Over 54 crore Jan Dhan accounts have been opened, and more than 52 crore collateral-free loans sanctioned under various flagship schemes like PM Mudra, Stand-Up India, PM-SVANidhi, PM Vishwakarma. “Under the Mudra scheme, 68% of beneficiaries are women and under PM-SVANidhi scheme, 44% of beneficiaries are women.”

Through the implementation of the 12th Bipartite Settlement (BPS), the bank employees received a salary hike of 17%, along with other developments like revised halting rates and revised rates for reimbursement of expenses on-road travel. Other benefits include increased the ex-gratia of ₹10,000 per month to pre-1986 retirees and 100% DA neutralisation to pre-2002 retirees.

Additionally, a monthly ex-gratia payment has been implemented for pensioners and family pensioners during the current bipartite period.

Focused on women-centric policies, the government has introduced special leave provisions for women employees during their menstrual periods. “Special leave provisions for women employees including those related to leave during menstrual period, infertility treatment, second child adoption and the events of stillbirth.”