The Central government is to receive a large sum in form of dividend income as the public sector banks set to payout a total of Rs 13,804 crore for 2022-23 (FY23), nearly 58 per cent higher than Rs 8,718 crore received in FY22, a report by BusinessLine (BL) said on Thursday.
This can be attributed to healthy profits and strong capital position reported by these banks in the year.
This can be attributed to healthy profits and strong capital position reported by these banks in the year.
The dividend income will be counted as the Centre's non-tax revenue in FY23.
According to the report, three out of 12 PSBs declared a three-digit dividend, in percentage terms, in FY23. These are the State Bank of India (1,130 per cent of face value), Bank of Baroda (275 per cent) and Canara Bank (120 per cent).
SBI reported an all-time high standalone net profit of Rs 50,232 crore in FY23. Last year, it had declared a dividend of 710 per cent.
Six PSBs have declared dividends between four to 86 per cent. On the other hand, three PSBs namely, Central Bank of India, Indian Overseas Bank and Uco Bank did not declare any dividend.
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On top of the dividend from PSBs, the Centre will also receive a higher dividend from the Reserve Bank of India (RBI). Last week, the central bank announced that it has approved a dividend payout of Rs 87,416 crore, nearly triple of what was paid in the previous year.
The dividend payout is higher than the amount estimated in the Union Budget 2023-24 from the central bank and state-owned financial institutions. The Centre was expecting Rs 48,000 crore from the RBI.
The dividend payout by the RBI was Rs 30,307 crore for the accounting year 2021-22.
In FY23, the Centre earned Rs 40,953 crore from the RBI and public sector financial institutions. It was lower compared to the budget estimate of Rs 73,948 crore.
