Finance Ministry to Evaluate Public Sector Banks' Performance Amidst Global Unrest

The finance ministry will meet with heads of public sector banks to assess financial performance and credit progress to agriculture and MSMEs amidst global unrest. Key discussions include regional rural bank operations, digital fraud, asset recovery, and the Jan Samarth portal. PSBs recorded a record profit of Rs 1.98 lakh crore in 2025-26.

The finance ministry has arranged a crucial meeting with the leaders of public sector banks to evaluate their financial performance and assess credit flow to agriculture and MSMEs amid ongoing global tensions in West Asia. The gathering, chaired by Financial Services Secretary M Nagaraju, coincides with his impending retirement.

This session marks the first after public sector banks reported an extraordinary net profit of Rs 1.98 lakh crore for the fiscal year ending March 2026. Discussions will also cover regional rural bank operations and financial performance. Sources indicate that AI, digital frauds, and the Jan Samarth portal will be on the agenda. Asset recovery procedures under the DRT and Securitisation Act will also be reviewed.

Public sector banks demonstrated strong growth in 2025-26, with an aggregate operating profit of Rs 3.21 lakh crore and a record net profit increase. Business volumes reached Rs 283.3 lakh crore, registering notable growth. Asset quality has seen substantial improvement, with declining NPA ratios and effective recovery mechanisms.