Indian Economy News

Public Sector Banks (PSBs) record an all-time high net profit of US$ 22.59 billion in 2025-26, marking the fourth straight year of profitability

Public Sector Banks (PSBs) in India recorded their highest-ever net profit of Rs. 1.98 lakh crore (US$ 22.59 billion) in 2025-26, marking the fourth consecutive year of profitability. According to the Ministry of Finance, the strong performance was driven by sustained business growth, improved asset quality and enhanced operational efficiency. Aggregate business of PSBs rose by 12.8% year-on-year to Rs. 283.3 lakh crore (US$ 3.23 trillion), while aggregate deposits increased by 10.6% to Rs. 156.3 lakh crore (US$ 1.78 trillion). Gross advances grew by 15.7% to Rs. 127 lakh crore (US$ 1.45 trillion), reflecting robust credit demand across sectors. Retail, Agriculture, and MSME lending registered healthy growth of 18.1%, 15.5% and 18.2%, respectively.

Further, the statement highlighted that PSBs achieved historically low levels of stressed assets during 2025-26. Gross Non-Performing Assets (GNPA) ratio declined to 1.93%, while Net NPA ratio fell to 0.39% as of March 31, 2026. Fresh slippages reduced to 0.7%, and recoveries, including written-off accounts, stood at Rs. 86,971 crore (US$ 9.92 billion). Aggregate operating profit reached Rs. 3.21 lakh crore (US$ 36.63 billion), supported by stronger underwriting standards, improved risk management and technology-driven operational gains. PSBs also strengthened their capital position, with aggregate Capital to Risk (Weighted) Assets Ratio (CRAR) improving to 16.6%, aided by capital raising of Rs. 50,551 crore (US$ 5.77 billion). The government stated that continued reforms and governance measures have made PSBs stronger, well-capitalised and capable of supporting India’s long-term economic growth aspirations.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.