August 14, 2025

Mumbai: Hold your breath! Indian banks have made a stunning leap in the equity market in FY25. Driven by a sharp strategy to diversify their treasury holdings, 16 major banks ramped up their equity investments by a whopping 49%, hitting ₹49,572 crore. Leading this charge was the State Bank of India (SBI), whose investments skyrocketed, tripling to ₹22,000 crore compared to the previous year. It’s not just SBI – Bank of Baroda, Canara Bank, and UCO Bank more than doubled their stock commitments too. Why this sudden love for shares? The year FY25 saw the BSE Sensex hitting an eye-popping all-time high of 85,978 points on September 27, 2024. Although the Sensex's overall rise in this fiscal was a modest 5.1%, the buzz around the markets was irresistible. Retail investors were not far behind; their fear of missing out—famous as FOMO—pushed many to enter the market. As a result, investor accounts on NSDL jumped from 35.8 million last year to 39.5 million, whereas CDSL accounts soared from 115.6 million to 153 million. Businesses and banks both smelled opportunity. Bank investments in equities form part of their treasury operations, involving fresh and existing shares held through subsidiaries and affiliates. Plus, a new accounting rule called fair value treatment—implemented from April 1, 2024—gave banks a fresh reason to beef up their stock portfolios. So, what’s behind these moves? Bank treasuries are weaving clever strategies to ride high on market opportunities and diversify risk. Banks see equities as exciting assets, especially after retail market mania surged. To sum up, FY25 witnessed Indian banks embracing stocks with unprecedented enthusiasm, riding the waves of a roaring Sensex and retail investor frenzy. With investments leaping 49% and SBI’s triple surge leading the pack, it’s clear that Indian banks have set the stage for bold market plays ahead.

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Tags: Indian banks, Equity investments, Fy25, Sbi, Retail investors, Treasury diversification,