The Ministry of Finance has officially postponed its scheduled performance review meeting with the chief executives of public sector banks (PSBs) to May 6, 2025, shifting from the previously planned date of April 17. The meeting, to be chaired by Financial Services Secretary M. Nagaraju, is being organized to thoroughly assess the financial progress made by state-run banks and to set clear targets for the upcoming financial year 2025–26.
According to people familiar with the matter, the agenda for the rescheduled meeting will include a comprehensive review of the banks’ profitability, operational efficiency, and credit growth. Additionally, discussions will cover the implementation and future targets of key government-sponsored financial inclusion schemes such as the Pradhan Mantri Jan Dhan Yojana (PMJDY), the PM Mudra Yojana, StandUp India, and the PM Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi).
These schemes are critical to the Centre’s ongoing efforts to boost entrepreneurship, increase access to formal banking in underserved communities, and facilitate easier access to credit for small businesses and marginalized groups.
Public Sector Banks Log Record-Breaking ₹1.29 Lakh Crore Profit in 9 Months
Public sector banks are heading into the review meeting with remarkably strong financial results, marking a period of unprecedented profitability and stability. Collectively, the 12 government-owned banks reported a record-high net profit of ₹1.29 lakh crore during the first nine months of the ongoing fiscal year (April to December 2024), reflecting a robust 31.3% year-on-year growth.
This outstanding performance is attributed to several key factors, including:
- Improved credit quality, with a sharp decline in non-performing assets (NPAs).
- Healthy capital buffers, ensuring financial resilience.
- Strong operating profits, driven by effective cost management and increased lending activity.
Government data indicates that the net NPA ratio across PSBs dropped to just 0.59%, with total net NPA standing at ₹61,252 crore. This is a clear indicator of better loan recovery processes and stronger underwriting practices across the banking sector.
On the operational side, public sector banks recorded an aggregate operating profit of ₹2.20 lakh crore during the April–December period. Their total business, which includes deposits and advances, expanded to ₹242.27 lakh crore, driven by:
- An 11% year-on-year growth in total business volume.
- A 9.8% rise in deposits, signaling renewed trust among depositors.
- Increased credit disbursal, especially to the MSME and retail sectors.
These figures demonstrate that PSBs have not only stabilized after a period of bad loan stress but are also becoming engines of credit growth and financial inclusion, aligning closely with the government’s broader economic priorities.
Strategic Goals for FY 2025–26
The upcoming May 6 meeting is expected to serve as a roadmap-setting session for the fiscal year ahead. Bank heads are likely to be briefed on new performance benchmarks related to the government’s flagship schemes. Discussions may also include digital banking targets, expansion of rural outreach, and strengthening of cyber security frameworks in public sector banks.
With the general elections approaching and expectations high from both retail and institutional stakeholders, the ministry is keen on ensuring that public sector banks play a stronger, more inclusive, and technology-driven role in India’s economic growth story in FY26.
