NPAs of PSBs Fall to Four-Year Low; SBI, Union Bank, PNB Lead in Total Write-offs

Public sector banks (PSBs) have cut their non-performing assets (NPAs) to Rs 91,261 crore in FY25, a 28 per cent drop from the Rs 1,27,237 crore peak in FY23 and the sharpest improvement in asset quality in recent years. Figures tabled in the Rajya Sabha by Minister of State for Finance Pankaj Chaudhary showed that between FY22 and FY25, the country’s 12 PSBs together reported Rs 4,48,869 crore in NPAs.

The trajectory has been downward after FY23. NPAs increased from Rs 1,15,749 crore in FY22 to Rs 1,27,237 crore in FY23 before easing to Rs 1,14,622 crore in FY24 and a further sharper fall in FY25.

State Bank of India, with its dominant market share, accounted for the largest share of NPAs in over the four-year period at Rs 80,197 crore. It was followed by Union Bank of India at Rs 68,557 crore, Punjab National Bank at Rs 65,366 crore, Bank of Baroda at Rs 55,279 crore and Canara Bank at Rs 47,359 crore. 

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In contrast, smaller lenders such as Punjab and Sind Bank, Bank of Maharashtra and UCO Bank reported significantly lower cumulative NPAs — Rs 5,734 crore, Rs 6,395 crore and Rs 9,930 crore respectively — underscoring the differences in loan book size and exposure.

“Banks write-off NPAs in respect of which full provisioning has been made on completion of four years, as per RBI guidelines and policy approved by banks' Boards. Such write-off does not result in waiver of liabilities of borrowers and therefore, it does not benefit the borrower. The borrowers continue to be liable for repayment and banks continue to pursue recovery actions initiated in these accounts,” Chaudhary said.

Further, recovery in written-off loans is an ongoing process and banks continue pursuing their recovery actions initiated against borrowers under the various recovery mechanism available to them, he said.

As per the data shared by Chaudhary, PSBs reported 2,280 unique borrowers classified as wilful defaulters as on March 31, 2022, with an aggregate loan outstanding of Rs 2,05,461 crore. The number declined to 2,120 borrowers as on March 31, 2023, with outstanding loans of Rs 1,85,773 crore, and stood at 2,153 borrowers with Rs 1,85,483 crore outstanding as on March 31, 2024. 

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By March 31, 2025, the count had further reduced to 2,101 borrowers with an outstanding amount of Rs 1,78,766 crore. As of June 30, 2025, there were 2,104 wilful defaulters, with aggregate loans outstanding of Rs 1,76,693 crore.

From FY23 to FY25, the total business of PSBs had increased from Rs 203 lakh crore to Rs 251 lakh crore, while net profit had increased from Rs 1.04 lakh crore to Rs 1.78 lakh crore.

In the annual review meeting in June this year for PSBs with Finance Minister Nirmala Sitharaman, the latter was informed that the PSBs are adequately capitalised, with their CRAR standing at 16.15 per cent as of March 2025.