Synopsis: In the third quarter of FY25, public sector banks (PSBs) outpaced their private counterparts in branch expansion, a shift from the usual trend. State Bank of India (SBI) and Canara Bank led the way, adding 200 and 158 new branches, respectively. Meanwhile, Axis Bank and ICICI Bank were the key players in the private sector.
Public Banks Outpace Private Peers in Branch Expansion During Q3 FY25:
Traditionally, private banks have been at the forefront of branch expansion in India.
However, in the third quarter of the financial year 2024-25 (Q3 FY25), public sector banks (PSBs) took the lead, outpacing their private peers in network growth.
The State Bank of India (SBI) and Canara Bank emerged as the biggest contributors to this expansion, reinforcing their presence across key regions.
Public Sector Banks Take the Lead:
SBI, India's largest public lender, expanded aggressively in Q3, adding 200 new branches, a significant jump from the 60 branches it added in the previous quarter.
Canara Bank followed closely, increasing its branch network by 158 new locations.
Other notable contributors include Bank of Baroda, which opened 18 new branches in Q3, bringing its total to 120 new branches in FY25 so far.
Indian Overseas Bank also strengthened its footprint by adding 53 new branches, reflecting a steady expansion strategy among PSBs.
Punjab & Sind Bank saw the least expansion, adding only four new branches during the quarter, indicating a more cautious approach compared to its peers.
Private Sector Banks: Mixed Performance
In contrast, private banks showed varied performance in branch expansion. Axis Bank and ICICI Bank led the private sector’s growth, although they did not match the pace set by PSBs.
On the other hand, Bandhan Bank and Dhanlaxmi Bank remained stagnant, not adding any new branches.
South Indian Bank even witnessed a decline, shutting down five branches during the period.
The trend marks a shift from the previous quarter (Q2 FY25), where HDFC Bank dominated branch expansion by opening 241 new locations, followed by Axis Bank with 150 new branches.
The change in dynamics suggests that PSBs are ramping up their physical presence, possibly to strengthen their market reach and enhance accessibility in rural and semi-urban areas.
Conclusion:
The third quarter of FY25 has seen a strategic shift in India's banking landscape, with public sector banks aggressively expanding their branch networks while private banks showed a more measured approach. SBI and Canara Bank’s leadership in this expansion signals a renewed focus by PSBs on increasing accessibility and market penetration.
As the banking sector evolves, this trend may indicate a balanced growth strategy where both digital advancements and physical infrastructure play a crucial role in financial inclusion.
Disclaimer: The information provided in this article is based on publicly available data and financial reports. Readers are advised to conduct their own research or consult financial experts before making any banking or investment decisions.
