Public sector banks report profit of over Rs 31,817 cr

Public sector banks report profit of over Rs 31,817 crore

'This is the first year when PSBs have reported profit after five years of losses,' Sitharaman said after the review

Representative Image. Credit: iStock Photo

In a healthy sign, public sector banks (PSBs) in India have reported a profit of Rs 31,817 crore in the financial year 2020-21.

The PSBs reported healthy profits and have accelerated on technology-driven reforms, according to the annual review meeting of PSBs in Mumbai chaired by Union Finance Minister Nirmala Sitharaman. 

“These banks have reported a profit of Rs 31,817 crore in the financial year 2020-21 as compared to a loss of Rs 26,016 crore in the financial year 2019-20. This is the first year when PSBs have reported profit after five years of losses,” Sitharaman said after the review.

The total gross non-performing assets (NPAs) stood at Rs 6.16 lakh crore as of March 2021 — a reduction of Rs 62,000 crore from March 2020 levels.  

The number of frauds at PSBs has also substantially come down to 2,903 in FY21 compared to 3,704 in FY19.

Also Read | FM Nirmala Sitharaman hikes PSBs' pension contribution for employees to 14%

During the review, Sitharaman was accompanied by Revenue Secretary Tarun Bajaj and Financial Services Secretary Debasish Panda.

During her two-day visit to the financial capital, Sitharaman unveiled the fourth edition of the PSB Reforms Agenda ‘EASE 4.0’ for 2021-22 — tech-enabled, simplified, and collaborative banking. 

Nearly 72 per cent of financial transactions happening at PSBs are now happening through digital channels. 

PSBs are now offering services across call centres, internet banking and mobile banking in 14 regional languages such as Telugu, Marathi, Kannada, Tamil, Malayalam, Gujarati, Bengali, Odia, Kashmiri, Konkani, Hindi, Punjabi, Assamese for ease of customers.

For continual improvement in coverage under financial inclusion initiatives, there was a 13 per cent growth in transactions provided by Bank Mitras in rural areas and 50 per cent growth in enrolments in micro personal accident insurance in Q4FY21 compared to Q4FY20. During the financial year 2020-21, PSBs have collectively disbursed Rs 40,819 crore of fresh personal, home and vehicle loans through leads sourced from such digital channels.

The top 7 PSBs have built analytics capabilities through the setup of dedicated analytics teams and IT infrastructure to proactively offer loans to their existing customers. Such loan offers were generated using the existing customer transactions data within the banks. 

In FY21, Rs 49,777 crore of fresh retail loan disbursements were made by the top 7 PSBs based on these credit offers.

PSBs have also extensively used external partnerships and dedicated marketing salesforce network for the sourcing of retail segment and MSME segment loans. Sourcing from such channels has been 9.1 lakh loans in FY21.

SBI, BoB Union Bank of India win top honours

State Bank of India, Bank of Baroda and Union Bank of India have won the awards for best performing banks for PSB Reforms EASE 3.0 based on the EASE index. Indian Bank won the award for the best improvement from the baseline performance. SBI, BoB, Union Bank of India, Punjab National Bank and Canara Bank won the top awards in different themes of the PSB Reforms Agenda EASE 3.0.

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