Three major public sector banks are experiencing a significant 350+ basis points gap between their credit and deposit growth rates, according to provisional quarterly business data reported by The Economic Times. Bank of Baroda led this disparity with the widest gap, while Bank of India and Punjab National Bank also showed substantial differences in their business expansion patterns. The gap has widened compared to previous quarters, indicating growing challenges in maintaining balanced growth across these key banking metrics.
Bank of Baroda reported a 17.42% year-on-year advance growth to ₹14.2 lakh crore and a 13.81% deposit growth to ₹16.3 lakh crore at the end of the June quarter, as reported by The Economic Times. However, the bank experienced sequential contraction in both assets and liabilities from March 2026 levels, indicating a challenging operating environment despite strong annual growth figures. This sequential decline in both assets and liabilities from March 2026 levels represents a significant concern for the bank's business momentum.
In contrast to Bank of Baroda's performance, Bank of India and Punjab National Bank demonstrated consistent business expansion across both annual and quarterly metrics. PNB reported a 12.85% year-on-year advances growth to ₹12.8 lakh crore and 8.52% growth in deposits to ₹17.3 lakh crore, while BoI achieved an 18.64% year-on-year advances growth to ₹8 lakh crore and 14.92% deposits growth to ₹9.6 lakh crore, according to the provisional quarterly business data. Both banks reported consistent expansion in their business figures year-on-year and quarter-on-quarter, highlighting the stark contrast with Bank of Baroda's sequential decline.
