Finance Minister Nirmala Sitharaman received a dividend cheque of 6,959.29 crore for FY 2023-24 from SBI Chairman Dinesh Kumar Khara, the finance minister’s office announced on Friday.

“Smt@nsitharaman receives a dividend cheque of 6959.29 crore for FY 2023-24 from@TheOfficialSBI Chairman Shri Dinesh Kumar Khara,” the finance minister’s official handle, @nsitharamanoffc, posted on X.

The post noted that in the previous fiscal year, the State Bank of India paid the Government of India its highest-ever dividend of 5,740 crore.

According to a February report in Mint, the central government may seek increased dividends from public sector banks for the current fiscal year due to their robust performance.

The banking sector’s outlook, as revised by an ICRA report, has shifted from positive to stable due to expectations of moderate credit growth and stable profitability metrics.

However, there are concerns about interest margin compression over the last 18 months due to rising deposit costs, although a potential rate cut in the latter half of FY25 may alleviate some pressures.

Loan growth may result in steady operating profits, aided by benign credit costs. The report added that this will drive earnings, which will be sufficient for most banks to meet their regulatory and capital requirements.

The Reserve Bank of India (RBI) approved a substantial dividend payout of 2.11 lakh crore to the central government for FY 2023-24, marking a significant increase from the previous fiscal year’s payout. The RBI reported a 141% surge in net income for FY24, driven by reduced expenditures, particularly lower provisions. The government anticipates dividends of approximately 1.02 trillion from the RBI, state-run banks, and other financial institutions, as outlined in interim budget documents.

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