Record profit of Rs 1.42 lakh crore for government banks

Public sector banks have earned record profits so far in the financial year 2023-24. During this period, the total profit of 12 banks increased to Rs 1,42,129 crore. These banks had earned a record profit of Rs 1.05 lakh crore in 2022-23. In 2021-22 this figure was Rs 66,540 crore. During this period, there was a decline in the profits of only three banks, UCO, Indian Overseas and Punjab and Sindh Bank.
The profits of banks have increased due to the ‘four R’ strategy of the government. This includes transparent identification of NPAs, resolution and recovery, recapitalization and financial system reforms. Under this strategy, the government has infused a total of Rs 3.11 lakh crore capital into banks between 2016-17 and 2020-21. This has helped the banks.
The second reason is…continuous recovery and reduction in bad loans i.e. NPA. The effect of this was that during the financial year 2023-24, the net NPA of all banks came down to below the level of 1.70 percent. Bank of Maharashtra’s NPA was the highest at 0.20 percent, while Punjab and Sindh Bank’s NPA was the highest at 1.63 percent.