New Delhi, Aug. 30 -- Regional rural banks (RRBs) are emerging from a prolonged period of financial stress with stronger capital buffers, lower bad loans and improved profitability. While RRBs' aggregate capital to risk-weighted assets ratio (CRAR) stood at 15% in FY2025-26, their gross non-performing assets (GNPA) fell to an all-time low of 5.3%. RRBs also reported a record net profit of Rs.10,176 crore, with total business crossing Rs.13.5 trillion.

The improvement comes after years of consolidation and balance-sheet repair, with the government now seeking to use the stronger financial position of RRBs to expand rural credit, deepen financial inclusion and improve operational efficiency. Mint explains:

RRBs' aggregate CRAR has steadil...