In the financial year 2023-24, the profitability of banks improved for the sixth consecutive year and their bad loans came down to a 13-year low of 2.7 percent. The Reserve Bank of India (RBI) gave this information in a report on Thursday. This RBI report released on banking trends and progress says that the country's strong macroeconomic fundamentals have boosted the performance and soundness of the domestic banking and non-banking financial sectors. According to the report, the profitability of banks increased for the sixth consecutive year in 2023-24 and continued to grow in the first half of 2024-25.

Asset quality of banks improved

The RBI report says that the asset quality of banks has improved and their gross non-performing asset (GNPA) ratio came down to 2.7 percent at the end of March 2024 and 2.5 percent at the end of September 2024, which is the lowest level in 13 years. The capital position of banks remained satisfactory during this period, which is also reflected in key parameters like debt ratio and capital to risk weighted asset ratio (CRAR). Apart from this, the books of non-banking financial companies (NBFCs) strengthened with strong loan expansion.

How many banks are there

According to the RBI report, the loan quality and profitability of banks have improved. The net profit of scheduled commercial banks increased by 32.8 percent to Rs 3,49,603 crore in the last financial year. At the end of March 2024, the commercial banking sector comprised 12 public sector banks, 21 private sector banks, 45 foreign banks, 12 small finance banks, six payment banks, 43 regional rural banks and two local area banks (LABs).