Banking & NBFC

Indian banks demonstrated robust financial performance in fiscal year 2026, with public sector banks collectively reporting a historic ₹1.98 lakh crore net profit, marking a fourth consecutive year of profitability. This was underpinned by declining non-performing asset ratios – gross NPAs fell to a record low of 1.93% and net NPAs to 0.39% – and strong credit growth of 15.9% across the sector, driven particularly by the services and MSME segments. Several institutions, including Indian Overseas Bank and Bank of India, posted significant profit increases, while others like AU Small Finance Bank are accelerating their adoption of AI-driven technologies to enhance lending efficiency. These developments suggest continued resilience and growth potential within the Indian banking sector, though ongoing liquidity management actions by the RBI warrant monitoring.