Finance Minister Nirmala Sitharaman will likely meet the chiefs of public sector banks (PSBs) on Thursday to assess their performance in 2024-25 in various parameters, including profitability, bad loans recovery, deposit mobilisation, digital payments, cyber security and implementation of government schemes, sources told FE.
It is to be noted that 12 PSBs have recorded a robust 26% annual growth in net profit at Rs 1.78 lakh crore in 2024-25 compared with Rs 1.41 lakh crore in 2023-24.
The review meeting will be attended by senior officials of the department of financial services.
“Besides the various financial parameters like profit and non-performing assets (NPAs), the banks’ performance in deposits, credit, financial inclusion, cyber security, etc, will likely be reviewed,” an official said.
The implementation of new credit products or schemes and access to credit under financial inclusion will likely be discussed. The meeting may also delve into joint efforts of banks with regulators and security agencies against fraud and cybersecurity risks amid heightened tension with Pakistan.
Banks performance on further increasing credit flow to eligible beneficiaries under initiatives like PM Surya Ghar Muft Bijli Yojana, PM Vishwakarma Yojana, Pradhan Mantri Jan Dhan Yojana (PMJDY), Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY) may also be reviewed. The government has rolled out several credit enhancement schemes, including a new credit assessment model for MSMEs based on digital footprints and cash flows.
The meeting will likely take note of the adequate capital buffers, aggregate capital to risk-weighted assets ratio, among others.
Sources said PSBs are adequately capitalised and well poised to meet the credit demands of all sectors of the economy, with special thrust on agriculture, MSME and the infrastructure sector.
The government’s nude for policy and process reforms have resulted in enhanced systems and processes for credit discipline, recognition and resolution of stressed assets, responsible lending, improved governance, financial inclusion initiatives and technology adoption, sources said.
The PSBs reported an aggregate net non-performing asset (NPA) ratio at Rs 61,252 crore or 0.59% till December 2024.