Public sector banks post record ₹1.98 lakh crore net profit in FY 2025-26

Ziraat Times Team Report

New Delhi, May 29: Public Sector Banks (PSBs) recorded their highest-ever annual net profit of around ₹1.98 lakh crore during the financial year 2025-26, while gross non-performing assets (GNPA) declined to a historic low of 1.93 per cent, according to the Department of Financial Services (DFS).

The figures were reviewed during a meeting chaired by Secretary, Department of Financial Services, Shri M. Nagaraju, to assess the performance and progress of Public Sector Banks across operational, financial and strategic priorities for FY 2025-26.

The meeting was attended by the Special Secretary, DFS, senior ministry officials, Chairman of State Bank of India, Managing Directors and Chief Executive Officers, and Executive Directors of Public Sector Banks.

Aggregate business crosses ₹283 lakh crore

According to the ministry, the aggregate business of PSBs reached approximately ₹283.3 lakh crore as on March 31, 2026, reflecting strong financial and operational performance.

The review noted that Net Non-Performing Assets (NNPA) also improved significantly, declining to 0.39 per cent, indicating continued strengthening of bank balance sheets and prudent risk management practices.

The performance of PSBs was assessed across several areas including business growth, profitability, implementation of government schemes, financial inclusion, digital banking ecosystem, MSME credit flow, cyber resilience and operational risk management.

Coffee table book on unclaimed assets unveiled

During the meeting, a coffee table book titled “आपकी पूँजी, आपका अधिकार (Your Money, Your Right)” was unveiled.

The publication highlights a nationwide campaign aimed at helping citizens identify and reclaim unclaimed financial assets through collaborative efforts by banks, financial institutions, regulators and other stakeholders.

Officials said that over the past six months, more than ₹6,800 crore had been restituted to nearly 29 lakh claimants across the country.

Revamped DFS website launched

The Department of Financial Services also launched its revamped website during the meeting.

Designed with a citizen-centric approach, the portal includes enhanced accessibility features, seamless navigation and improved information dissemination.

According to the ministry, the website is available in 23 regional languages and includes accessibility features for visually impaired users, reinforcing the government’s focus on inclusive and accessible digital services.

Focus on financial inclusion and digital lending

The meeting also reviewed progress under key financial inclusion initiatives including Pradhan Mantri Jan Dhan Yojana, social security schemes, Pradhan Mantri Mudra Yojana, PM Vishwakarma and digital lending programmes.

Officials said Public Sector Banks continue to play a major role in expanding banking access and strengthening last-mile delivery of financial services across the country.

The implementation status of end-to-end digital lending systems for small-value loans and welfare-linked schemes was also reviewed.

Banks highlighted measures such as paperless processing through e-KYC and digital documentation, straight-through processing systems and integration with government platforms to improve customer experience and accessibility.

Banks advised prudence amid global uncertainties

Discussions during the meeting also focused on strengthening digital banking ecosystems, enhancing cyber security frameworks and improving credit access for MSMEs and productive sectors of the economy.

The Department advised banks to adopt prudent expenditure and austerity measures while maintaining operational resilience amid evolving global uncertainties.

Public Sector Banks were also asked to provide proactive support to eligible borrowers under ECLGS 5.0, strengthen grievance redressal systems, improve operational efficiency and explore new business opportunities for sustained growth and profitability.

The ministry further advised banks to remain prepared for any impact arising from the recent crisis in the Middle East and other evolving global developments.

Special Secretary, DFS, emphasised the need for strengthening institutional capabilities, operational efficiency and innovation-driven banking practices in a rapidly changing financial ecosystem.

Secretary DFS Shri M. Nagaraju stressed the importance of robust grievance redressal systems, strong governance standards and operational preparedness to ensure that the banking system remains resilient and aligned with the vision of Viksit Bharat.