What was the median profit per employee for public sector banks in FY25?

Public sector bank employees generated a median profit of ₹19.6 lakh in FY25.

Why has the profit per employee increased for PSU banks?

Increased efficiency is due to retirements outpacing new hirings, leading to fewer staff managing more business.

Did the number of employees in PSU banks increase or decrease in FY25?

After six years of decline, the headcount in PSU banks saw a slight increase in FY25.

Home / Business and Economy / PSU Banks Outperform Private Lenders in Profitability

PSU Banks Outperform Private Lenders in Profitability

5 Jan

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Summary

Public sector bank employees generated ₹19.6 lakh profit in FY25.
Fewer new hires and more retirements boosted per-employee efficiency.
PSU bank headcount grew slightly after six years of decline.

PSU Banks Outperform Private Lenders in Profitability

In fiscal year 2025, public sector bank employees achieved a median profit of ₹19.6 lakh, a notable increase from the ₹14.5 lakh generated by private bank employees in the same period. This trend signals a significant shift in efficiency within government-owned financial institutions, challenging past perceptions of underperformance. The Reserve Bank of India's data highlights a widening profit gap favoring public sector banks.

The enhanced profitability per employee is largely a result of workforce restructuring. Public sector banks have experienced a higher rate of employee retirement than recruitment over the past decade. This demographic trend, coupled with a strategic consolidation of banks initiated in 2019, has led to a leaner workforce. Consequently, the remaining employees are managing larger business volumes, driving up per-employee efficiency metrics.