The banking sector showed stronger profitability and improved asset quality in FY25, even as margins moderated and fraud-related amounts rose, according to RBI Report on Trend and Progress of Banking in India. The GNPA ratio declined to a multi-decadal low of 2.2%. Banks also stepped up sale of stressed assets to ARCs, with loans sold at a book value of Rs 16.19 lakh crore in FY25, compared with Rs 10.25 lakh crore a year earlier.
Agencies
Private and foreign banks accounted for a significantly higher share of ARC sales. Among non-bank lenders, NBFCs saw asset and income growth in FY25, though net profit moderated slightly to Rs 1.32 lakh crore. HFCs reported steady improvement in profitability, with net profit rising to Rs 19,367 crore, while asset growth remained largely stable.
