Public sector banks profit rises
Despite subpar performances by sizable institutions like SBI and PNB, all 12 public sector banks together made a profit of roughly Rs 15,306 crore, representing an increase of 9.2% yearly.
According to quarterly data released by public sector lenders, state-owned banks made a total profit of Rs 14,013 crore from April through June of the previous fiscal.
Three of the 12 lenders—the State Bank of India (SBI), the Punjab National Bank (PNB), and the Bank of India—reported profit declines ranging from 7 to 70%.
These lenders’ declining profits have been ascribed to Mark-to-Market (MTM) losses brought on by rising bond yields.
MTM losses happen when the market values the retained financial assets less than what was paid for them.
Public sector banks
During the first quarter of FY23, nine lenders reported profits ranging from 3 to 117%. The Bank of Maharashtra, which has its headquarters in Pune, saw the largest percentage growth, with a profit of Rs 452 crore compared to Rs 208 crore in the same quarter last year.
SBI continued to provide the most to the combined profit of banks, at Rs 6,068 crore, despite seeing a decline in its earnings. SBI alone was responsible for nearly 40% of the overall profit. Bank of Baroda came next with Rs 2,168 crore.
The combined earnings of public sector banks increased significantly between 2021 and 2022, rising from Rs 31,816 crore to Rs 66,539 crore. Two public sector banks (Central Bank and Punjab & Sind Bank) were the only ones to post losses in FY21, which reduced the overall net profit.
Following a pause, many state-owned banks distributed dividends in the most recent fiscal year. A total of Rs 7,867 crore in dividends were declared to shareholders by nine banks, including SBI.
Between 2015–16 and 2019–20, there were five consecutive years of losses as a group.
The greatest net loss was recorded in 2017–18 at Rs 85,370 crore, and it was followed by losses of Rs 66,636 crore, Rs 25,941 crore, Rs 17,993 crore, and Rs 11,389 crore in the next two years.