FINANCIAL PERFORMANCE OF COMMERCIAL BANKS IN INDIA

Vol. 71, Issue. 02, No.4, April-June: 2022 Page. 54
Journal
of the
Oriental Institute
M.S. University of Baroda
ISSN: 0030-5324
FINANCIAL PERFORMANCE OF COMMERCIAL BANKS IN INDIA
Dr.C. PARAMASIVAN Assistant Professor
G.RAVICHANDIRAN Ph.D. Full Time Research Scholar
PG & Research Department of Commerce Periyar E.V.R.College (Autonomous), Tiruchirappalli-
620023. (Affiliated to Bharathidasan University, Tiruchirappalli, India)
ABSTRACT
Banking is one of the major components of financial system of the country which determines
the money circulation among the people. Performance the banking sectors depends on its financial
performance commitments and soundness. Financial performance is the only factor which decides the
operational efficiency and its sustainability of banking sectors. Every banking sector tries to maintain
their financial strength and updated services. It is observed that, a financially viable banking services
can survive in the market and contribute user friendly services to the customers.With this view, the
present papers made and attempt to discuss the financial performance of commercial banks with the
help of income and expenditures and consolidated balance sheet for the year 2019-20.
KEY WORDS:Financial system, banking sector, commercial banks, public sector banks, financial
performance, balance sheet,Banking Regulation Act
INTRODUCTION
Financial systems of the country decide the flow of money from one hand to another for
productivity purpose. Banking is one of the fundamental components of financial systems. Banks are
the nerve system of a nation’s economy and provide an outline of how the country’s economic growth
and financial activities will perform. A well organised and regulated banking system helps to promote
the economic activities in an advanced manner. Indian banking industry has recently observed the roll
out of innovative banking models like payments and small finance banks. RBI’s new measures may
go a long way in helping the restructuring of the domestic banking industry. Therefore Indian banking
sectors systematically structured with sufficient systems, like commercial banks, cooperative banks
etc. Commercial banks are controlled under the Banking Regulation Act 1949 and empower a bank to
carry out business operations of keeping money as deposits and grant loans to the public, corporate
and the government itself. With this perspective, the present paper made and attempts to discuss the
financial performance of commercial banks with the help of income and expenditures and consolidated
balance sheet for the year 2019-20.
PROFILE OF COMMERCIAL BANKS
Banking is one of the major components of financial system of the country which decide the
money circulation among the people. The Indian banking system consists of 12 public sector banks,
22 private sector banks, 46 foreign banks, 56 regional rural banks, 10 small fiancé banks, 6 payment
banks, 1485 urban cooperative banks and 96,000 rural cooperative banks in addition to cooperative
credit institutions. As of November 2020, the total number of ATMs in India increased to 209,282.
Indian banking sector is one of the fast-growing sectors in the world with huge account holder and
investment. Banking infrastructure and facilitates have been increasing significantly due to the
globalisation and information technology. In 2006, financial inclusion initiatives enlarge the banking
penetration and reached unreached places and people.Commercial banks in India are the mainstay of
all key economic activities in the country, whether it is for the citizens to keep their hard-earned money
safely or get loans whenever they need funds for important things like a home, wedding, a car or for
business. To say that banks and businesses run hand in hand would be equivalent is because without
adequate credit support it is hard to embellishment businesses and vice versa.

REVIEW OF LITERATURE
Padma.D., &Arulmathi.V. (2013). Mentioned that Performance and efficiency of commercial
banks are the key elements of countries financial system. In view of this, the study set out to apply
Profitability ratios, Solvency ratios and Management efficiency ratios on SBI and ICICI Bank in order
to compare their efficiency and solvency position.
Ritesh Patel. (2018). Mentioned that the financial performance is evaluated on the basis of
various variables. It has been observed that after the merger, the Assets, Equity, Investment and
advances of all banks increases, but due to underutilization, their respective yield decreases.
Mani Govil., &Mishu Tripathi. (2014). Suggested that the banking sector suffered huge
setback in terms of loss in liquidity, asset quality, profitability and a short-term rise in demand for bank
credit. The paper examines the impact of the global crisis on a sample of top ten ranking banks by
using trend analysis of important financial indicators.
Anand Atulkumar Joshi., &Yashasvi R. Rajpara. (2020). Mentioned that banking scenario,
various sectors like Public Sector Bank, Private sector bank, Foreign Bank and Small Finance bank
plays a catalyst role in the development and growth of the economy as a whole. Such sectors of banks
act as competitors as well as collaborators at the same time.
Venkatesh Thummalapenta., & Sardar Gugloth. (2020). Explained that Indian banking
sector has been passing through a complex, but comprehensive phase of reform and restructuring since
1991. The whole banking scenario has changed a lot in the recent past on the base of implementation
of Narasimham Committee Report and other reforms.
Gautam Prasad., & Ankita Rajput. (2020). Concluded thatthe CAMEL approach is a useful
tool to examine the safety and soundness of banking sectors in India. In the present study, the
performance of Punjab National Bank using the CAMEL approach has been studied.
Jeevan Jayant Nagarkar. (2015). Revealed that Business cycles are not new to the Indian
economy. In last ten years India witnessed two major phases of business cycle. High growth tide lifted
all boats and high revenue high profits were taken for granted. The last four years have been the phase
of recession.
Banking
Scheduled
Commercial
Banks
Public sector
banks
Private Sector
Banks
Foreign Banks
Regional Rural
Banks
Payment Banks
Small Finance
Banks
Cooperative
Banks
Urban
Cooperative
Banks
Rural
Cooperative
Banks
Non Scheduled

Meraj Banu., & Sudha Vepa. (2021). Explained that the banking system in India has
witnessed the fastest growth in comparison to other governing sectors of the Indian economy. The
solvency and sustenance of banks do not only concern the depositors but equally to the other
participants viz., the employees, the customers, the shareholders and the country as a whole.
Divyang Joshi., Samir Thakkar., & et al. (2021). Suggested that the banking industry is
important to a country's economic growth. With a large network of branches and a diverse range of
financial services, India's banking system is large. The financial performance of banks was analyzed
using net profit, assets, liabilities, income, expense, margin ratio, and return on equity ratio.
Mustafa Hassan Mohammad Adam. (2014). Several financial performance parameters are
used such as financial ratios analysis which is used to measure the financial position for the bank and
on broader range statistical tools also have been used for analysis purpose of several variables which
would affect the banking system in general in order to know whether these variables are significantly
correlated with the financial performance for the bank.
Saranya. C., & Sridevi. V. (2019). Mentioned that Banking plays an important role in the
growth and development of Indian economy in each and every aspect. The main aim of the study is to
compare and evaluate the financial performance of selected banks using CAMEL rating system.
Sunita Chaki., Kshamta Chauhan., & et al. (2019). Pointed that the global financial crisis
started showing its contagion effect on the Indian economy, the financial performance and soundness
indicators witnessed a chequered performance.
Tapas Kumar Sethy. (2017). Mentioned that Bank consolidation through merger and
acquisition has been strongly argued by many researchers and policy makers with a view to enhance
performances through synergy effect and wider geographical coverage of banking networks in India.
Table No-1 : Consolidated Balance Sheet of Public Sector Banks – 2019-20
(Rs. in crore)
Sl.No Items
Public Sector
Banks
All Commercial
Banks
% to Total
1 Capital 72,040 1,90,802 37.76
2 Reserves and Surplus 5,80,886 12,82,884 45.28
3 Deposits 90,48,420 1,39,75,095 64.75
3.1.Demand Deposits 5,71,383 13,39,167 42.67
3.2.Savings Bank Deposit 30,41,902 42,95,779 70.81
3.3.Term Deposits 54,35,134 83,40,149 65.17
4 Borrowings 7,09,780 16,96,046 41.85
5 Other Liabilities and Provisions 3,71,893 8,70,048 42.74
Total Liabilities/Assets 1,07,83,018 1,80,14,875 59.85
1
Cash and Cash Balances with
RBI
4,36,736 7,69,492 56.75
2
Balances with Banks and Money
at Call and Short Notice
4,66,615 7,83,753 59.53
3 Investments 29,40,636 46,89,842 62.70
3.1. In Government Securities
(a+b)
24,09,182 38,81,046 62.07
a) In India 23,71,783 38,12,845 62.20
b) Outside India 37,399 68,201 54.83
3.2. Other Approved Securities 102 102 100
3.3. Non- Approved Securities 5,31,352 8,08,694 65.70
4 Loan and Advances 61,58,112 1,03,01,914 59.77
4.1. Bills Purchased and
Discounted
1,60,977 3,47,955 46.26
4.2. Cash Credits Overdrafts, etc. 24,16,408 36,11,575 66.90
4.3. Term Loans 35,80,727 63,42,385 56.45
5 Fixed Assets 1,06,507 1,50,728 70.66

6 Other Assets 6,74,412 13,19,146 51.12
Source: Report of TPBII 2019-20.
Table No-1 Indicates that Consolidated Balance Sheet of Public Sector Banks in India, Capital
of Public Sector Banks amounted to Rs.72,040 crore (37.76%) as against Rs.1,90,802 crore, Reserves
and surplus of Public sector banks amounted to Rs.5,80,886 crore (45.28%) as against Rs.12,82,884
crore, Deposits of Public sector banks amounted to Rs.90,48,420 crore (64.75%) as against
Rs.1,36,75,095 crore, Borrowings of Public sector banks amounted to Rs.7,09,780 crore (41.85%) as
against Rs.16,96,046 crore, other Liabilities and Provision of Public sector banks amounted to
Rs.3,71,893 crore (42.74%) as against Rs.8,70,048 crore, Loan and Advances of Public sector banks
amounted to Rs.61,58,112 crore (45.28%) as against Rs.1,03,01,914 crore, Fixed Assets of Public
sector banks amounted to Rs.1,06,507 crore (70.66%) as against Rs.1,50,728crore,OtherAssetsof
Public sector banks amounted to Rs.6,74,412 crore (51.12%) as against Rs.13,19,146 crore of total
Capital of Commercial Banks as on 2019-20.
Table No-2
Income and Expenditure of Public Sector Banks
(Amount in Rs. crore)
Sl.No Items Public Sector
Banks
Total % in
Total
1. Income 8,34,320 14,82,858 56.26
a) Interest Income 7,16,203 12,48,435 57.36
b) Other Income 1,18,117 2,34,422 50.38
2. Expenditure 8,60,335 14,71,947 58.45
a) Interest Expended 4,68,005 7,62,794 61.35
b) Operating Expenses 1,91,925 3,47,469 55.23
Of which : Wage Bill 1,15,044 1,74,354 65.98
c) Provision and Contingencies 2,00,405 3,61,685 55.41
3. Operating Profit 1,74,390 3,72,595 46.80
4. Net Profit -26,015 10,911 -41.94
5. Net Interest Income (NII)(1a-2a) 2,48,198 4,85,641 51.10
6. Net Interest Margin (NIM) 2.37 2.8 84.64
Source: Consolidated Annual Report of RBI.
Table No-2 Indicates that Income and Expenditure of Public Sector Banks in India, Income of
Public Sector Banks amounted to Rs.8,34,320 crore as against Rs.14,82,858 crore, of total Income of
Commercial Banks as on 2019-20.Expenditure of Public sector banks amounted to Rs.8,60,335 crore
as against Rs.14,71,947 crore of total expenditure of Commercial Banks as on 2019-20, Operating
Profit of Public sector banks amounted to Rs.1,74,390 crore as against Rs.3,72,595 crore of total Profit
of Commercial Banks as on 2019-20,Net Profit of Public sector banks amounted to Rs.-26,015 crore
as against Rs.10,911 crore of total Net Profit of Commercial Banks as on 2019-20, Net Interest Income
of Public sector banks amounted to Rs.2,48,198 crore as against Rs.4,85,641 crore of total Net Interest
Income of Commercial Banks as on 2019-20, Net Interest Margin of Public sector banks amounted to
Rs.2.37 crore as against Rs.2.8 crore of total Net Interest Margin of Commercial Banks as on 2019-
20.
Table No-3
Consolidated Balance Sheet of Private Sector Banks - 2019-20
(Rs. in Crore)
Sl.No Items
Private
Sector
Banks
All
Commercial
Banks
% to Total
1 Capital 26,866 1,90,802 14.08
3 Deposits 41,59,044 1,39,75,095 29.76
3.1.Demand Deposits 5,47,521 13,39,167 40.88

Source: Report of TPBII 2019-20
Table No-3 Indicates that Consolidated Balance Sheet of Private Sector Banks in India, Capital
of Private Sector Banks amounted to Rs.26,866 crore as against Rs.1,90,802 crore, Reserves and
surplus of Private sector banks amounted to Rs.5,82,425 crore (45.40%) as against Rs.12,82,884 crore,
Deposits of Private sector banks amounted to Rs.41,59,044 crore (29.76%) as against Rs.1,36,75,095
crore, Borrowings of Private sector banks amounted to Rs.8,27,575 crore (48.79%) as against
Rs.16,96,046 crore, other Liabilities and Provision of Private sector banks amounted to Rs.2,36,229
crore (27.15%) as against Rs.8,70,048 crore, Loan and Advances of Private sector banks amounted to
Rs.36,25,154 crore (35.19%) as against Rs.1,03,01,914 crore, Fixed Assets of Private sector banks
amounted to Rs.38,243 crore (25.37%) as against Rs.1,50,728 crore, Other Assets of Private sector
banks amounted to Rs.3,90,770 crore (29.62%) as against Rs.13,19,146 crore of total Capital of
Commercial Banks as on 2019-20.
Table No-4
Income and Expenditure of Private Sector Banks
Sl.
No
Items
Private Sector
Banks
Total
% to
Total
1. Income 5,46,041 14,82,858 36.82
a) Interest Income 4,48,566 12,48,435 35.93
b) Other Income 97,476 2,34,422 41.58
2. Expenditure 5,26,930 14,71,947 35.80
a) Interest Expended 2,58,038 7,62,794 33.83
b) Operating Expenses 1,26,320 3,47,469 36.35
Of which : Wage Bill 47,357 1,74,354 27.16
3.2.Savings Bank Deposit 11,72,739 42,95,779 27.30
3.3.Term Deposits 24,38,784 83,40,149 29.24
4 Borrowings 8,27,575 16,96,046 48.79
5
Other Liabilities and
Provisions
2,36,229 8,70,048 27.15
Total Liabilities/Assets 58,32,139 1,80,14,875 32.37
1
Cash and Cash Balances
with RBI
2,72,616 7,69,492 35.43
2
Balances with Banks and
Money at Call and Short
Notice
2,12,324 7,83,753 27.09
3 Investments 12,93,031 46,89,842 27.57
3.1. In Government
Securities (a+b)
10,66,313 38,81,046 27.47
a) In India 10,57,074 38,12,845 27.72
b) Outside India 9,240 68,201 13.55
3.2. Other Approved
Securities
- 102 0
3.3. Non- Approved
Securities
2,26,718 8,08,694 28.03
Discounted
1,25,078 3,47,955 35.94
4.2. Cash Credits Overdrafts,
etc.
9,83,165 36,11,575 27.22
4.3. Term Loans 25,16,912 63,42,385 39.69
5 Fixed Assets 38,243 1,50,728 25.37
6 Other Assets 3,90,770 13,19,146 29.62

c) Provision and Contingencies 1,42,572 3,61,685 39.42
3. Operating Profit 1,61,684 3,72,595 43.39
4. Net Profit 19,111 10,911 -57.09
5. Net Interest Income (NII) (1a-2a) 1,90,528 4,85,641 39.23
6. Net Interest Margin (NIM) 3.42 2.8 -81.87
Table No-4 Indicates that Income and Expenditure of Private Sector Banks in India, Income of
Private Sector Banks amounted to Rs.5,46,041 crore as against Rs.14,82,858 crore of total Income of
Commercial Banks as on 2019-20, Expenditure of Private sector banks amounted to Rs.5,26,930 crore
Profit of Private sector banks amounted to Rs.1,61,684 crore as against Rs.3,72,595 crore of total Profit
of Commercial Banks as on 2019-20, Net Profit of Private sector banks amounted to Rs.19,111 crore
of Private sector banks amounted to Rs.1,90,528 crore as against Rs.4,85,641 crore of total Net Interest
Income of Commercial Banks as on 2019-20,Net Interest Margin of Private sector banks amounted to
Rs.3.42 crore as against Rs.2.8 crore of total Net Interest Margin of Commercial Banks as on 2019-
20.
Table No-5
Consolidated Balance Sheet of Foreign Banks – 2019-20
(Rs. in crores)
Sl.No Items
Foreign
Banks
All
Commercial
Banks
% to Total
1 Capital 85,710 1,90,802 44.92
3 Deposits 6,84,289 1,39,75,095 4.90
3.1.Demand Deposits 2,17,874 13,39,167 16.27
3.2.Savings Bank Deposit 70,007 42,95,779 1.63
3.3.Term Deposits 3,96,408 83,40,149 4.75
4 Borrowings 1,28,687 16,96,046 7.59
5
Provisions
2,57,632 8,70,048 29.61
1
Cash and Cash Balances with
RBI
55,048 7,69,492 7.15
2
Notice
95,658 7,83,753 12.20
3 Investments 4,31,277 46,89,842 9.19
3.1. In Government Securities
(a+b)
3,84,109 38,81,046 9.90
a) In India 3,62,547 38,12,845 9.50
b) Outside India 21,562 68,201 31.61
3.2. Other Approved Securities - 102 0
3.3. Non- Approved Securities 47,168 8,08,694 5.83
Discounted
61,864 3,47,955 17.78
etc.
2,05,130 36,11,575 5.68
4.3. Term Loans 1,61,078 63,42,385 2.54
5 Fixed Assets 4,129 1,50,728 2.74

6 Other Assets 2,51,120 13,19,146 19.03
Table No-5 Indicates that Consolidated Balance Sheet of Foreign Banks in India, Capital of
Foreign Banks amounted to Rs.85,710 crore as against Rs.1,90,802 crore, Reserves and surplus of
Foreign Banks amounted to Rs.1,08,987 crore (8.40%) as against Rs.12,82,884 crore, Deposits of
Foreign Banks amounted to Rs.6,84,289 crore (4.90%) as against Rs.1,36,75,095 crore, Borrowings
of Foreign Banks amounted to Rs.1,28,687 crore (7.59%) as against Rs.16,96,046 crore, other
Liabilities and Provision of Foreign Banks amounted to Rs.2,57,632 crore (29.61%) as against
Rs.8,70,048 crore, Loan and Advances of Foreign Banks amounted to Rs.4,28,072 crore (4.15%) as
against Rs.1,03,01,914 crore, Fixed Assets of Foreign Banks amounted to Rs.4,129 crore (2.74%) as
against Rs.1,50,728 crore, Other Assets of Foreign Banks amounted to Rs.2,51,120 crore (19.03%) as
against Rs.13,19,146 crore of total Capital of Commercial Banks as on 2019-20.
Table No-6
Income and Expenditure of Foreign Banks
Sl.No Items
Foreign
Banks Total % to Total
1. Income 83,223 14,82,858 5.61
a) Interest Income 66,673 12,48,435 5.34
b) Other Income 16,550 2,34,422 7.05
2. Expenditure 67,043 14,71,947 4.55
a) Interest Expended 28,810 7,62,794 3.78
b) Operating Expenses 21,584 3,47,469 6.21
c) Provision and Contingencies 16,648 3,61,685 4.60
3. Operating Profit 32,829 3,72,595 8.81
4. Net Profit 16,180 10,911 -67.43
5. Net Interest Income (NII) (1a-2a) 37,863 4,85,641 7.80
Table No-6 Indicates that Income and Expenditure of Foreign Banks in India, Income of
Foreign Banks amounted to Rs.83,223 crore as against Rs.14,82,858 crore of total Income of
Commercial Banks as on 2019-20, Expenditure of Foreign Banks amounted to Rs.67,043 crore as
against Rs.14,71,947 crore of total expenditure of Commercial Banks as on 2019-20, Operating Profit
of Foreign Banks amounted to Rs.32,829 crore as against Rs.3,72,595 crore of total Profit of
Commercial Banks as on 2019-20, Net Profit of Foreign Banks amounted to Rs.16,180 crore as against
Rs.10,911 crore of total Net Profit of Commercial Banks as on 2019-20, Net Interest Income of Foreign
Banks amounted to Rs.37,863 crore as against Rs.4,85,641 crore of total Net Interest Income of
Commercial Banks as on 2019-20, Net Interest Margin of Foreign Banks amounted to Rs.3.26 crore
as against Rs.2.8 crore of total Net Interest Margin of Commercial Banks as on 2019-20.
Table No-7
Consolidated Balance Sheet of Small Finance Banks – 2019-20
(Rs. in crores)
Sl.No Items
Small
Finance
Banks
All
Commercial
Banks
% to Total
1 Capital 5,151 1,90,802 2.70
2 Reserves and Surplus 11,047 12,82,884 0.86
3 Deposits 82,488 1,39,75,095 0.59
3.1.Demand Deposits 2,381 13,39,167 0.18
3.2.Savings Bank Deposit 10,284 42,95,779 0.24
3.3.Term Deposits 69,823 83,40,149 0.84

4 Borrowings 30,004 16,96,046 1.77
5
Provisions
4,078 8,70,048 0.47
1
Cash and Cash Balances
with RBI
5,058 7,69,492 0.66
2
Notice
8,701 7,83,753 1.11
3 Investments 24,203 46,89,842 0.52
3.1. In Government
Securities (a+b)
20,748 38,81,046 0.53
a) In India 20,748 38,12,845 0.54
b) Outside India - 68,201 0
3.2. Other Approved
Securities
- 102 0
3.3. Non- Approved
Securities
3,455 8,08,694 0.43
4 Loan and Advances 90,576 1,03,01,914 0.88
Discounted
37 3,47,955 0.01
etc.
6,872 36,11,575 0.19
4.3. Term Loans 83,668 63,42,385 1.32
5 Fixed Assets 1,649 1,50,728 1.09
6 Other Assets 2,580 13,19,146 0.19
Table No-7 Indicates that Consolidated Balance Sheet of Small Finance Banks in India, Capital
of Small Finance Banks amounted to Rs.5,151 crore as against Rs.1,90,802 crore, Reserves and surplus
of Small Finance Banks amounted to Rs.11,047 crore (0.86%) as against Rs.12,82,884 crore, Deposits
of Small Finance Banks amounted to Rs.82,488 crore (0.59%) as against Rs.1,36,75,095 crore,
Borrowings of Small Finance Banks amounted to Rs.30,004 crore (1.77%) as against Rs.16,96,046
crore, other Liabilities and Provision of Small Finance Banks amounted to Rs.4,078 crore (0.47%) as
against Rs.8,70,048 crore, Loan and Advances of Small Finance Banks amounted to Rs.90,576 crore
(0.88%) as against Rs.1,03,01,914 crore, Fixed Assets of Small Finance Banks amounted to Rs.1,649
crore (1.09%) as against Rs.1,50,728 crore, Other Assets of Small Finance Banks amounted to
Rs.2,580 crore (0.19%) as against Rs.13,19,146 crore of total Capital of Commercial Banks as on
2019-20.
Table No-8
Income and Expenditure of Small Finance Banks
Sl.No Items
Small
Finance
Banks
Total % to Total
1. Income 19,219 14,82,858 1.30
a) Interest Income 16,948 12,48,435 1.35
b) Other Income 2,271 2,34,422 0.97
2. Expenditure 17,251 14,71,947 1.17
a) Interest Expended 7,928 7,62,794 1.04
b) Operating Expenses 7,152 3,47,469 2.06
c) Provision and Contingencies 2,171 3,61,685 0.60

3. Operating Profit 4,139 3,72,595 1.11
4. Net Profit 1,968 10,911 18.03
5. Net Interest Income (NII) (1a-2a) 9,020 4,85,641 1.86
Table No-8 Indicates that Income and Expenditure of Small Finance Banks in India, Income
of Small Finance banks amounted to Rs.19,219 crore as against Rs.14,82,858 crore of total Income of
Commercial Banks as on 2019-20, Expenditure of Small Finance Banks amounted to Rs.17,251 crore
Profit of Small Finance Banks amounted to Rs.4,139 crore as against Rs.3,72,595 crore of total Profit
of Commercial Banks as on 2019-20, Net Profit of Small Finance Banks amounted to Rs.1,968 crore
of Small Finance Banks amounted to Rs.9,020 crore as against Rs.4,85,641 crore of total Net Interest
Income of Commercial Banks as on 2019-20, Net Interest Margin of Small Finance Banks amounted
to Rs.8.34 crore as against Rs.2.8 crore of total Net Interest Margin of Commercial Banks as on 2019-
20.
Table No-9
Consolidated Balance Sheet of Payments Banks – 2019-20
(Rs. in crores)
Sl.No Items
Payments
Banks
All
Commercial
Banks
% to Total
1 Capital 1,035 1,90,802 0.54
2 Reserves and Surplus -461 12,82,884 -0.03
3 Deposits 855 1,39,75,095 0.01
3.1.Demand Deposits 8 13,39,167 0.01
3.2.Savings Bank Deposit 847 42,95,779 0.02
3.3.Term Deposits - 83,40,149 0
4 Borrowings - 16,96,046 0
5 Other Liabilities and Provisions 216 8,70,048 0.02
Total Liabilities/Assets 1,645 1,80,14,875 0.01
1 Cash and Cash Balances with RBI 33 7,69,492 0.01
2
Balances with Banks and Money at Call and
Short Notice
455 7,83,753 0.06
3 Investments 694 46,89,842 0.01
3.1. In Government Securities (a+b) 694 38,81,046 0.02
a) In India 694 38,12,845 0.02
b) Outside India - 68,201 0
3.2. Other Approved Securities - 102 0
3.3. Non- Approved Securities - 8,08,694 0
4 Loan and Advances - 1,03,01,914 0
4.1. Bills Purchased and Discounted - 3,47,955 0
4.2. Cash Credits Overdrafts, etc. - 36,11,575 0
4.3. Term Loans - 63,42,385 0
5 Fixed Assets 200 1,50,728 0.13
6 Other Assets 263 13,19,146 0.02
Source: Report of TPBII 2019-20.
Table No-9 Indicates that Consolidated Balance Sheet of Payments Banks in India, Capital of
Payments Banks amounted to Rs.1,035 crore as against Rs.1,90,802 crore of total Capital of
Commercial Banks as on 2019-20, which constitute 0.54 per cent of total Capital, Reserves and Surplus
of Payments Banks amounted to Rs.-461 crore as against Rs.12,82,884 crore of total Reserves and
Surplus of Commercial Banks as on 2019-20, Deposits of Payments Banks amounted to Rs.855 crore

as against Rs.1,39,75,095 crore of total Deposits of Commercial Banks as on 2019-20, Other Liabilities
and Provision of Payments Banks amounted to Rs.216 crore as against Rs.8,70,048 crore of total Other
Liabilities and Provision of Commercial Banks as on 2019-20, Fixed Assets of Payments Banks
amounted to Rs.200 crore as against Rs.1,50,728 crore of total Fixed Assets of Commercial Banks as
on 2019-20,Other Assets of Payments Banks amounted to Rs.263 crore as against Rs.13,19,146 crore
of total Fixed Assets of Commercial Banks as on 2019-20.
Table No-10 :Income and Expenditure of Payments Banks
Sl.No Items Payments Banks Total % to Total
1. Income 55 14,82,858 12.1
a) Interest Income 46 12,48,435 9.5
b) Other Income 9 2,34,422 28.3
2. Expenditure 389 14,71,947 9.3
a) Interest Expended 14 7,62,794 7.3
b) Operating Expenses 488 3,47,469 13.1
Of which : Wage Bill 264 1,74,354 16.6
c) Provision and Contingencies -112 3,61,685 10.1
3. Operating Profit -446 3,72,595 22.2
4. Net Profit -334 10,911 -1.21
5. Net Interest Income (NII) (1a-2a) 32 4,85,641 13.0
6. Net Interest Margin (NIM) 1.95 2.8 69.64
Table No-10 Indicates that Income and Expenditure of Payments Banks in India, Income of
Payments banks amounted to Rs.55 crore as against Rs.14,82,858 crore of total Income of Commercial
Banks as on 2019-20, which constitute 12.1 per cent of total Income, Expenditure of Payments banks
amounted to Rs.389 crore as against Rs.14,82,858 crore of total Expenditure of Commercial Banks as
on 2019-20,Operating Profit of Payments banks amounted to Rs.-446 crore as against Rs.3,72,595
crore of total Operating Profit of Commercial Banks as on 2019-20, Net Profit of Payments banks
amounted to Rs.-336 crore as against Rs.10,911 crore of total Net Profit of Commercial Banks as on
2019-20,Net Interest Income of Payments banks amounted to Rs.32 crore as against Rs.4,85,641 crore
of total Net Interest Income of Commercial Banks as on 2019-20,Net Interest Margin of Payments
banks amounted to Rs.1.95 crore as against Rs.2.8 crore of total Net Interest Margin of Commercial
Banks as on 2019-20.
SUGGESTIONS AND CONCLUSION
Banking sector in India is one of the fastest growing sectors with multidimensional services
and features with the help of information and communication technology. The Asset of public sector
banks is stood at Rs. 107.83 lakh crore in 2020. During 2016-2020, bank credit grew at a CAGR of
3.57 per cent. As of 2020, total credit extended surged to US$ 1,698.97 billion. During 2016-2020,
deposits grew at a CAGR of 13.93 per cent and reached US$ 1.93 trillion by 2020. According to the
RBI, bank credit stood at 108.79 trillion and bank deposits are stood at Rs. 155.14 trillion, as of July
16, 2021.Credit to non-food industries stood at Rs. 107.93 trillion, as of July 16, 2021.
Banking sector in India is one of the most dominant part of the economy which decide the flow
and sustainability of economy of the country. After 1991 Indian banking sector become a vibrant and
dominant component of financial system of the country. During 2000, banking industries were
transformed into modern and innovative approaches to offer services to customers and public.
Multidimensional services with cost effective manner. Therefore it is concluded that, a financially
viable banking services can survive in the market and contribute user friendly services to the
customers.
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