ADDING NEW BRANCHES: PRIVATE BANKS BEFORE PSBS

Major private sector banks continued to expand their branch network in the fiscal year ending March 2023, while public sector banks (PSB) witnessed a decrease in the number of branches.

HDFC Bank, the largest private lender bank, added nearly 1,500 branches, closing the year with more than 7,800, making it the largest number of new branch additions by a scheduled commercial bank in the country.

According to Anindya Banerjee, Group Chief Financial Officer, ICICI Bank, the pace of branch addition of the bank increased significantly in FY23. Of the 480 new branches during the year, 180 were opened in Q4. "We are expected to witness a significant increase in branch additions next year (FY24)," he said.

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The number of Axis Bank branches reached 4,903 local branches until March 2023, compared to 4,758 branches in the same period last year, along with expansion counters in 2,702 centers.

PSBs are going slow

Public sector banks are slowly adding real branches. For example, the State Bank of India only added 139 new branches during the last financial year. As of March 2023, the SBI had 22,405 branches, compared to 22,266 in the same period last year.

A senior SBI official said: “Public sector banks are going slow because we are the first to penetrate urban, peri-urban and rural areas and private banks are now catching up. Business lineadding that in fulfilling social obligations and spreading financial inclusion, public service bodies have a clear mandate and leadership.

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RBI data

According to RBI data, the number of bank branches in the public sector has been steadily declining in recent years while it is increasing for private banks. From 87,892 in March 2020, the number of PSB branches decreased to 86,311 in FY21 and 84,258 in FY22. On the other hand, the number of private bank branches increased from 34,794 in FY2020 to 37,872 in FY23.

The Reserve Bank of India has yet to release the consolidated data on the number of bank branches in the public and private sectors for the year 2022-2023.