The Reserve Bank of India (RBI) has released the report on “Trend and Progress of Banking in India 2022-23, showing the performance of the banking sector, including co-operative banks and Non-Banking Financial Companies (NBFCs) during 2022-23 and 2023-24.
The highlights of the report are as follows:
- The consolidated balance sheet of Scheduled Commercial Banks (SCBs) in 2022-23 expanded by 12.2 per cent, driven by credit to retail and services sectors; deposit growth also picked up, although it trailed credit growth.
- The Capital to Risk weighted Assets Ratio (CRAR) of SCBs was 16.8 per cent at end-September 2023, with all bank groups meeting the regulatory minimum requirement and the Common Equity Tier 1 (CET1) ratio requirement.
- The improvement in asset quality of banks that began in 2018-19 continued during 2022-23 and H1:2023-24, with Gross Non-Performing Assets (GNPA) ratio at 3.2 per cent at end-September 2023.
- Higher net interest income and lower provisioning boosted Net Interest Margin (NIM) and profitability in 2022-23.
- The combined balance sheet of Urban Co-operative Banks (UCBs) expanded by 2.3 per cent in 2022-23, driven by loans and advances. Their capital buffers and profitability improved through 2022-23 and Q1:2023-24.
- The consolidated balance sheet of NBFCs expanded by 14.8 per cent in 2022-23, led by double-digit credit growth. Profitability and asset quality of the sector also improved in 2022-23 and in H1:2023-24, even as the sector remained well-capitalised with CRAR higher than the regulatory requirement.
