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Public Sector Undertakings (Banks) are a major type ofgovernment-owned banks in India, where a majority stake (i.e., more than 50%) is held by theMinistry of Finance (India) of theGovernment of India orState Ministry of Finance of variousState Governments of India. The shares of these government-owned-banks are listed on stock exchanges. Their main objective is social welfare.
The Central Government entered the banking business with the nationalization of theImperial Bank of India in 1955. A 60% stake was taken by theReserve Bank of India and the new bank was namedState Bank of India. The seven other state banks became subsidiaries of the new bank in 1959 when theState Bank of India (Subsidiary Banks) Act, 1959 was passed by theUnion government.[1]
The next major government intervention in banking took place on 19 July 1969 when theIndira government nationalised an additional 14 major banks. The total deposits in the banks nationalised in 1969 amounted to 50 crores. This move increased the presence of nationalised banks in India, with 84% of the total branches coming under government control.[2]
The share of the bank sector controlled by public banks continued to grow through the 1980s, and by 1991 public sector banks accounted for 90% of the banking sector. A year later, in March, 1992, public sector banks operated 60,646 branches across India, with deposits totaling ₹1,10,000 crore. Most of these banks were profitable, with only one out of the 21 public sector banks reporting a loss.[3]
The nationalised banks reported a combined loss of ₹1160 crores. However, the early 2000s saw a reversal of this trend, such that in 2002-03 a profit of ₹7780 crores by the public sector banks: a trend that continued throughout the decade, with a ₹16856 crore profit in 2008–2009.[3]
The consolidation of SBI-associated banks started first by State Bank of India merging its subsidiary between 2008 and 2017.
On 30 August 2019, Minister of FinanceNirmala Sitharaman announced the government's plan for further consolidation of public sector banks. The mergers took effect from 1 April 2020.[8]
Currently there are 12 Nationalised Banks inIndia (Government Shareholding power is denoted in %, as of 29 October 2025[update]):
Regional Rural Banks (RRBs) aregovernment owned scheduled commercial banks of India that operate at the regional level in different states ofIndia. These banks are under theownership of theMinistry of Finance,Government of India, Sponsored Bank and concerned State Government in the ratio of 50:35:15 respectively. They were created to serve rural areas with basic banking andfinancial services. However, RRBs also have urban branches.[9]
Andhra Pradesh
Arunachal Pradesh
Assam
Bihar
Chhattisgarh
Gujarat
Haryana
Himachal Pradesh
Jammu and Kashmir
Jharkhand
Karnataka
Kerala
Madhya Pradesh
Maharashtra
Manipur
Meghalaya
Mizoram
Nagaland
Odisha
Puducherry
Punjab
Rajasthan
Tamil Nadu
Telangana
Tripura
Uttar Pradesh
Uttarakhand
West Bengal
