NEW DELHI: Finance minister Nirmala Sitharaman on Thursday (July 6) will meet the heads of public sector banks (PSBs) to take stock of their overall performance. She will review the credit growth, asset quality, capital requirement and overall profitability.

Besides this, she will also take feedback about the various government schemes, including Kisan Credit Card (KCC), Stand-Up India, Pradhan Mantri Mudra Yojana (PMMY) and emergency credit line guarantee scheme (ECLGS) to help businesses impacted by Covid-19.

This is the first review meeting by Sitharaman in the current fiscal after the review of the FY23 financial results of banks. “Finance minister will also discuss the bad loan situation in the banking sector. Though there has been a significant improvement in asset quality of banks, there are some sectors like gems and jewellery, textiles, construction and food processing which need attention,” a top official told this newspaper.

As per the Financial Stability Report of the RBI, the gross non-performing assets (GNPA) of the scheduled commercial banks fell to a 10-year low of 3.9 % in March 2023. These are likely to decrease further to 3.6% by March 2024, as per its report. The RBI conducted stress tests to assess the resilience of SCBs, which revealed that they are well-capitalised and capable of absorbing macroeconomic shocks.

Meanwhile, FM chaired a review meeting on the implementation of various Budget announcements with the Secretary, Department of Economic Affairs, Disinvestment Secretary, Banking Secretary, Corporate Affairs Secretary and other senior officials of the Finance Ministry in New Delhi on Tuesday.