IANS | 19 Jun, 2024
Public sector banks in India record a higher level of
"efficiency" compared to their private sector counterparts, according
to a study conducted by the State Bank of India (SBI).
The study evaluates efficiency by examining how effectively banks
utilise their resources.
“The results show that contrary to popular perceptions, the performance
of PSBs are much better than private and foreign banks,” said Soumya Kanti
Ghosh, SBI’s Group Chief Economic Advisor.
It also found that efforts by the government and the Reserve Bank of
India (RBI) to bring efficiency and productivity to the banking sector have
been successful.
The study revealed that public sector banks have generally been more
efficient than private banks, except during FY19-23. This is likely due to
mergers and the rationalisation of businesses, branches, and employees.
Despite undergoing numerous structural changes, PSBs have maintained an
efficiency level of 82.8 per cent, outperforming all scheduled commercial banks
at 81.2 per cent, private banks at 79.6 per cent, and foreign banks at 78.2 per
cent.
In the last 10 years, the Indian banking sector showed heightened
resilience and survived several challenges in the domestic and global
economies, the report added.
However, the takeover of certain weaker banks as part of the
restructuring of public sector banks has impacted the efficiency and
productivity of the acquiring banks.
--IANS