The Finance Ministry has called a meeting of heads of public sector banks (PSBs) on May 29 to review credit flows, financial performance and banking operations in the agriculture and MSME sectors amid the Middle East crisis.The meeting will be chaired by Financial Services Secretary M Nagaraju, a day before his retirement.According to sources, the functioning and financial performance of Regional Rural Banks (RRBs), progress on Jan Samarth portal, issues related to AI and digital fraud will also be discussed during the review meeting.The recovery mechanisms and progress under the Debt Recovery Tribunal (DRT) and Securitization and Reconstruction of Financial Assets and Security Interest Enforcement (SARFAESI) Act will also be discussed.The meeting comes after state-owned banks reported a record combined net profit of Rs 1.98 lakh crore in FY2016, the fourth consecutive year of profitability for PSBs.Better asset quality, loan growth and higher earnings helped boost earnings during the year.PSBs’ total operating profit stood at Rs 3.21 lakh crore, while net profit rose 11.1 per cent year-on-year to Rs 1.98 lakh crore.The total business of PSBs increased by 12.8 percent to Rs 283.3 lakh crore by March 31, 2026.Total deposits grew 10.6 per cent to Rs 156.3 lakh crore, while gross advances rose 15.7 per cent to Rs 127 lakh crore, reflecting sustained credit demand across sectors.Asset quality also improved, with the gross non-performing asset (NPA) ratio falling to 1.93 per cent and the net NPA ratio falling to 0.39 per cent at the end of FY26.Fresh slippage declined further during the year, with the slippage ratio falling to 0.7 per cent. The total recovery including accounts written off was Rs 86,971 crore.
