Banking Sector Remains Resilient In 2024-25, NPAs At Multi-Decadal Lows: RBI Report

New Delhi, Dec 30 (KNN) The Reserve Bank of India (RBI) on Monday released the Report on ‘Trend and Progress of Banking in India 2024-25’ in compliance with Section 36(2) of the Banking Regulation Act, 1949. 

The report reviews the performance of India’s banking and financial sector, including commercial banks, co-operative banks and non-banking financial institutions (NBFCs), during 2024-25 and developments in 2025-26 so far.

Commercial Banks Remain Resilient

According to the report, the Indian commercial banking sector remained resilient in 2024-25, supported by double-digit balance sheet expansion. 

Deposits and credit of scheduled commercial banks (SCBs) continued to grow at double-digit rates, although at a slower pace compared to the previous year.

Capital adequacy remained comfortable, with the capital to risk-weighted assets ratio (CRAR) of SCBs at 17.4 per cent at end-March 2025 and 17.2 per cent at end-September 2025.

Asset Quality at Multi-Decadal Lows

Asset quality strengthened further during the year. The gross non-performing assets (GNPA) ratio of SCBs declined to a multi-decadal low of 2.2 per cent at end-March 2025 and improved further to 2.1 per cent by end-September 2025.

Profitability Holds Firm

Profitability indicators remained robust. Return on assets (RoA) stood at 1.4 per cent and return on equity (RoE) at 13.5 per cent in 2024-25. During the first half of 2025-26, RoA moderated slightly to 1.3 per cent, while RoE declined to 12.5 per cent.

Co-operative Banks and NBFCs Show Improvement

The consolidated balance sheet of urban co-operative banks recorded stronger growth in 2024-25 compared with the previous year. Their asset quality improved for the fourth consecutive year, alongside gains in capital buffers and profitability.

NBFCs continued to register double-digit credit growth, supported by robust capital positions. The sector also reported an improvement in asset quality during the year.

(KNN Bureau)