The banking sector of the country is currently growing at a tremendous pace. In the quarter from October to December, the listed banks have given such a performance which has created a new history. For the first time, the total combined net profit of banks crossed Rs 1 lakh crore. This is also a big signal for the common people that banks are in a strong position and their earnings are continuously increasing. In the same quarter a year ago, this figure was around Rs 90 thousand crore, which means this time an increase of more than 10 percent was recorded.
If we talk about government and private banks, both performed well, but government banks were slightly ahead. Government banks earned a profit of about Rs 52 thousand crores, while the profit of private banks was about Rs 48 thousand crores. The share of public sector banks in the total profit was about 52 percent. The special thing is that the profits of government banks increased by more than 18 percent on an annual basis, while the growth of private banks remained around 3 percent.
Which banks created a stir?
Some big banks played a big role in this spectacular performance. Especially the contribution of State Bank of India, HDFC Bank and ICICI Bank was maximum. Almost half of the total earnings came from these three banks. Among private banks, HDFC Bank and ICICI Bank dominated, while in the public sector, SBI held a major stake.
Why did profits increase?
The biggest reasons behind the increase in banks’ earnings were better loan recovery and less bad loans (NPAs). Besides, interest income remained stable and good earnings were also generated from other sources. Although the expenses also increased, the overall profit was higher. This is the reason why the banking sector seems to be really booming at this time.
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