Public Sector Banks to Hire 50,000 Staff in FY26

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Big Hiring Plans for Public Sector Banks

Public sector banks (PSBs) are set to hire around 50,000 people this financial year. They want to fill nearly 21,000 officer-level positions. This will help banks grow and serve customers better.

State Bank of India (SBI) Takes the Lead

The State Bank of India (SBI) is leading this hiring push. SBI plans to hire close to 20,000 individuals, including specialized officers. So far, SBI has already hired:

• 505 probationary officers
• 13,455 junior associates

These new hires will make branch operations stronger across 35 states and Union Territories.

SBI’s Workforce and Hiring Costs

As of March 2025, SBI has 236,226 employees. This includes 115,066 officers. The bank has a low attrition rate of under 2%. This shows that employees are happy and well taken care of.

The average cost to hire a full-time employee in 2024-25 was Rs 40,440.59.

Other Banks’ Hiring Plans

Punjab National Bank (PNB), the second-largest state-run lender, plans to increase its staff by over 5,500 this fiscal year. As of March 2025, PNB had 102,746 employees.

Central Bank of India aims to recruit nearly 4,000 employees during the year.

Making the Most of Subsidiaries and Joint Ventures

The finance ministry has asked PSBs to think about making money from their investments in subsidiaries and joint ventures. They can do this by listing them on stock exchanges once operations grow.

Around 15 such subsidiaries and joint ventures are being considered for initial public offerings or selling in the medium to long term.

Improving Governance and Efficiency

To get ready for this, banks have been advised to:

• Make governance stronger
• Improve how they work
• Ensure professional decision-making in their subsidiaries

An official said, “Banks can look at unlocking value at the right time. Wherever necessary, PSBs may invest in these subsidiaries to support growth.”

Challenges and What’s Ahead

While hiring and growth are happening, the banking sector faces some short-term challenges. A recent report by Motilal Oswal says that net interest margins (NIMs) might be under pressure in the first half of FY26. This is because benchmark interest rates are falling, which could lower lending yields.

Even though banks are adjusting savings and term deposit rates, a delay in matching funding costs is likely to affect profits in the first half of the fiscal year.

Recovery and Growth Expected

The report expects things to get better in the second half of FY26. This recovery will be helped by:

• A slow reduction in deposit rates
• A 100-basis-point cut in the Cash Reserve Ratio (CRR) from September, which would increase liquidity

While Net Interest Income (NII) growth is expected to stay low at 1.7% year-on-year in Q1, public sector banks may see Profit After Tax (PAT) grow by 4.8% YoY, although down 11.7% compared to the previous quarter.

Overall, even with near-term margin pressures, the sector is expected to grow at a healthy rate of 11.1% in earnings between FY25 and FY27.