Archive · 2 Aug 2026
PSBs Reprice Over Rs 1 Lakh Crore Corporate Loans in Q1
Public sector banks in India decided to change the interest rates on a huge amount of loans they gave to companies.
They raised rates or stopped lending on some loans that were earning too little money.
This helps the banks earn more interest.
The main banks doing this are Bank of Baroda, Punjab National Bank, and Canara Bank.
They want to make their earnings from interest higher by the end of the year.
PSBs repriced or shed over Rs 1 lakh crore of low‑yield corporate loans in Q1.
Bank of Baroda, Punjab National Bank and Canara Bank led the effort, each moving about Rs 80,000 crore.
Canara Bank aims to raise its net interest margin to 2.60% by FY27 after a record quarter.
Banks are shifting low‑yield loans to MCLR or higher rates to improve yields.
The move reflects a tightening of lending rates that had fallen below 7% for top‑rated firms.
- Who
- Public sector banks – Bank of Baroda, Punjab National Bank, Canara Bank, and others
- What
- Repricing or shedding more than Rs 1 lakh crore of low‑yielding corporate loans
- When
- June quarter (Q1 of FY2024‑25)
- Where
- India
- Why
- To improve net interest margin and align loan rates with market conditions
- Total repriced loans
- Rs 1 lakh crore
- Key banks involved
- Bank of Baroda, Punjab National Bank, Canara Bank
- Target NIM for FY27
- 2.60%
- MCLR range
- 7.80% – 9.80%
- Canara Bank corporate loan book
- Rs 5.29 lakh crore