BANKING & FINANCE
Banking Affairs
Public Sector Banks Hit Record Profit Milestone of Rs 1.98 Lakh Crore in FY26
Public Sector Banks (PSBs) recorded a historic high net profit of Rs 1.98 lakh crore in FY26, marking the fourth consecutive year of profitability and reflecting an 11.1% year-on-year growth.
State Bank of India (SBI) remained the top contributor, accounting for over 40% of the total profit at Rs 80,032 crore, followed by Bank of Baroda and Punjab National Bank.
Asset quality reached record lows with the aggregate Gross NPA ratio dropping to 1.93% and the Net NPA ratio improving to 0.39% as of March 31, 2026.
PSBs strengthened their capital cushions with the aggregate Capital to Risk (Weighted) Assets Ratio (CRAR) improving to 16.6%, well above the regulatory requirement of 11.5%.
Significance: The record earnings enable PSBs to support larger credit expansion for the Indian economy and pay higher dividends to the government.
State Bank of India (SBI) remained the top contributor, accounting for over 40% of the total profit at Rs 80,032 crore, followed by Bank of Baroda and Punjab National Bank.
Asset quality reached record lows with the aggregate Gross NPA ratio dropping to 1.93% and the Net NPA ratio improving to 0.39% as of March 31, 2026.
PSBs strengthened their capital cushions with the aggregate Capital to Risk (Weighted) Assets Ratio (CRAR) improving to 16.6%, well above the regulatory requirement of 11.5%.
Significance: The record earnings enable PSBs to support larger credit expansion for the Indian economy and pay higher dividends to the government.
Key Facts / Static GK
Cabinet Minister of Finance: Smt. Nirmala Sitharaman
Top 3 Profitable PSBs (FY26): SBI, BoB, PNB
Aggregate CRAR of PSBs: 16.6%
Regulatory CRAR Requirement: 11.5%
Top 3 Profitable PSBs (FY26): SBI, BoB, PNB
Aggregate CRAR of PSBs: 16.6%
Regulatory CRAR Requirement: 11.5%
Practice Quiz — 13 May 2026
Q1. As per the latest RBI Master Direction, what is the maximum penalty for repeated violations regarding the refusal to exchange mutilated or soiled notes?
Answer: (D) Rs 5,00,000 — While the initial penalty for a single deficiency is Rs 10,000, it can rise to a maximum of Rs 5 lakh for repeated violations by a bank.
Q2. Under the new guidelines, what is the maximum daily limit for free exchange of soiled notes at any bank branch?
Answer: (B) 20 pieces or Rs 5,000 — RBI allows free exchange of soiled notes for up to 20 pieces or a total value of Rs 5,000 per day over the counter.
Q3. Which of the following statements regarding the VB-G RAM G Act is incorrect?
Answer: (C) The Centre funds 100% of unskilled wages for all states. — Unlike MGNREGA, where the Centre funded 100% of unskilled wages, the new Act introduces a cost-sharing model (e.g., 60:40 for general states and 90:10 for Himalayan/NE states).
Q4. Who was sworn in as the 13th Chief Minister of Tamil Nadu in May 2026?
Answer: (C) Joseph Vijay — C. Joseph Vijay, leading the TVK party, took the oath as the 13th CM of Tamil Nadu, succeeding M.K. Stalin.
Q5. From July 1, 2026, if an educational institution wants to use stock price data for classroom demonstration for free, what is the minimum required time lag as per SEBI?
Answer: (D) 30-day lag — SEBI has standardized the delay to 30 days for educational use to simplify the earlier framework of 1-day/3-month lags.
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