New Delhi,  It looks like sunshine days for the Indian banking sector after having struggled with a seemingly never-ending gloom of rising non-performing assets (NPAs) and the Covid-19 pandemic, which hit their profits hard.

The September quarter results of public sector banks (PSBs) seem to have brought cheer for the Indian banking sector with all the major 12 PSBs recording net profits worth Rs 25,685 crore during the period under review.

On September 7, Finance Minister Nirmala Sitharaman had lauded all the 12 PSBs for their outstanding fiscal performance.

In a series of tweets, she said that "the continuous efforts of our government for reducing the NPAs and further strengthening the health of PSBs are now showing tangible results. All 12 PSBs declared net profit of Rs 25,685 cr in Q2FY23".

She said that the combined net profits of public sector banks recorded a year-on-year growth of 50 per cent.

Similarly, in the first half of the current fiscal, the 12 state-owned banks recorded total profits of Rs 40,991 crore, which were 31.6 per cent higher year-on-year.

Country's largest lender State Bank of India (SBI) reported a 74 per cent jump in profit to Rs 13,265 crore, while Canara Bank reported an 89 per cent jump in profit to Rs 2,525 crore.

UCO Bank reported a huge 145 per cent jump in profit to Rs 504 crore, while the Bank of Baroda reported 58.70 per cent profit of Rs 3,312.42 crore in the September quarter of 2022-23.

Experts have said that the financial performance of PSBs is expected to improve in the current fiscal of 2022-23 over the previous financial year, as NPAs are coming down and leverage of corporates too has been cut.

They informed that NPAs of banks were brought out especially after the asset quality review measure was introduced by the government in 2015.

While rising NPAs seem to be under control as of now, the Indian banking system had faced a serious threat from these in 2011, when they started rising and had reached a climax in 2017-18, when they reached 11.18 per cent.

Though now the NPAs have come down, experts say that it is a cyclical thing as they keep rising and falling. To help PSBs tide over the NPA problem, the government had infused Rs 3 lakh crore in these banks, which went a long way in stabilising them financially.

On the basis of this stability, state-owned banks are now able to issue bonds and raise funds from outside, which is gradually making them more financially independent, industry experts said.