PSU Bank Performance Analyzed

Public sector banks (PSBs) have been doing really well lately, and their stock prices are going up. The group of stocks that includes banks owned by the government – known as the Nifty PSU Bank index – jumped by 1% on Monday. This is good news because it shows these banks are performing stronger than other companies.

Key Points

• PSU banks gained 1% on Monday, while the broader market rose 0.12%.
• SBI, Bank of Baroda, Indian Bank, and Canara Bank stocks increased significantly.
• PSU bank stock prices are up 55% since their lowest point in the past year.
• PSB profits rose 4.7% year-over-year, better than private banks.
• Lower lending ratios and improved bank quality are driving PSB growth.
• Experts predict continued growth in H2FY26 due to increased demand and reduced borrowing costs.

Recent Stock Price Records

Several PSU banks recently hit new high prices. The State Bank of India (SBI) reached a record high of ₹999 on November 26, 2025. Indian Bank’s stock price also touched an all-time high of ₹898.60 on November 18, 2025. Bank of Baroda reached a peak of ₹298.45 on June 3, 2024, while Canara Bank hit a record high of ₹164.19 on November 9, 2010.

Why are PSU Banks Doing Better?

Public sector banks are performing better than private banks because their profits are growing faster. In the period from July to September of 2025 (Q2FY26), PSB profits increased by 4.7% compared to a decline for private banks. This is happening because banks are earning more money from fees and investments. Also, more people are borrowing money from these banks, and operating costs are under control.

Bank Quality and Lending

PSBs are also getting better at managing their loans. They are lending less money compared to private banks, giving them more room to lend. At the same time, the problem of bad loans is getting smaller, which helps banks grow.

Looking Ahead

Experts believe that PSU banks will keep performing well in the next six months (H2FY26). This is because of increased spending during festivals, lower borrowing costs, and improved loan quality. Saurabh Bhalerao from CareEdge Ratings said that the banks’ strong financial position – including plenty of money and strong stock prices – will continue to support their growth.

“PSU banks are benefiting from a low starting point and a strong lending ability, setting the stage for continued success.”