Over the years, several ups and downs have been observed in the banking sector. In the US in 2023, there was a stir in the global banking system due to the sinking of big banks like Silicon Valley Bank and Signature Bank. Similarly, there are increasing concerns about the safety of banks and NPA (Non-Performing Assets) in India. In such a situation, it is important to know which banks are the most safe and what should be focused on.
RBI (Reserve Bank of India) and other regulators regularly review the financial status of banks to maintain the stability of the banking system. Several measures are being taken to ensure the safety of banks in India, such as the insurance scheme deposited on the lines of FDIC (Federal Deposit Insurance Corporation). In this article, we will discuss things that will help you decide which bank is the most safe and in which banks will be right to deposit money.
Banking Crisis and Safety Measures
In the time of banking crisis, it is important to know which banks are safe and why. There are several criteria to measure the safety of banks, such as NPA rate, capital addicweed ratio (car), and liquidity ratio. Let’s take a look that which banks are considered to be the most secure in India:
| Bank name | Properties |
| SBI (State Bank of India) | India’s largest bank, strong financial condition. |
| Hdfc bank | High Capital Edicuce Ratio (CAR), Strong Management. |
| Icici bank | Miscellaneous business portfolio, strong liquidity ratio. |
| Axis bank | Rapidly developed bank, good financial condition. |
| Bank of baroda | Strong government support, diverse business. |
| Punjab National Bank | Government bank, stable financial condition. |
| Kotak mahindra bank | Strong private sector bank, high NPA recovery rate. |
Due to banking crisis
Banking crisis can arise due to many reasons, some of which are major reasons:
- High NPA: When loans given by the bank are not paid, it becomes NPA, which can weaken the bank’s financial position.
- Management failure: Poor management can put the bank in crisis.
- Scam: Large scams can eliminate bank’s capital.
- Low capital: Lack of adequate capital can put the bank in crisis.
How to check the security of the bank?
To check the security of a bank, attention should be paid to the following things:
- Bank’s balance sheet: This shows how the financial situation of the bank is.
- NPA Rate: Low NPA banks are considered more secure.
- Customer reviews: Customer experience can also be a good sign.
- RBI report: RBI periodically releases reports on the financial situation of banks.
Current status of Indian banks
The current situation of Indian banks is declining the rate of NPA, which is a positive sign. The rating agency Fitch estimates that by March 2025, the ratio of NPA may be 2.4%. However, stress in unsafe loans is increasing, which may be a challenge to financial stability.
What happens when a bank sinks?
If a bank sinks, customers may get a part of their deposit amount back. According to RBI rules in India, customers may get a certain part of their deposit under the deposit insurance scheme. This amount is usually up to Rs 5 lakh per depositor.
Investment in safe banks
Before investing in safe banks, it is important to know which banks are financially strong. Banks like SBI, HDFC Bank, and ICICI Bank are known for their strong financial conditions in India. Investing in these banks can be considered safe, but it is always advisable to consult a personal financial advisor before investment.
conclusion
To maintain the stability of the banking system, it is important that customers check the financial status of banks and invest in safe banks only. Banks are regularly reviewed by the RBI in India to ensure the safety of the deposit capital of the customers.
Disclaimer: This article is for general information and does not recommend a specific bank or investment option. It would be appropriate to consult a personal financial advisor before investment.
