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Key Takeaways
India has received ₹1,553.50 crore of dividend on Friday June 30, 2026 from Bank of India. MD & CEO of the Bank of India Rajneesh Karnatak presented a cheque dated June 17, 2026, to Finance Minister Nirmala Sitharaman in New Delhi. The function was attended by Shalini Pandit, Joint Secretary of Department of Financial Services and four Executive Directors of Bank of India.
The dividend amount represents the interim dividend for FY26 of Bank of India which comes to ₹4.65 per equity share. The dividend has been given based on Bank of India’s record-high FY26 earnings. The public sector lender has increased its net profit by 14.19% in FY26 to ₹10,527 crore against ₹9,219 crore in FY25. This reflects the overall scenario of other public sector banks. Together, Canara Bank, Bank of Baroda and Indian Bank paid ₹7,023 crore to the government for FY26 on June 29, 2026. Bank of Baroda registered its record FY26 profit of ₹20,021 crore with 8.50 per share dividend.
Government dividends from PSU banks add directly to non-tax revenue. In FY26, the Centre collected a record ₹78,438 crore in dividends from Central Public Sector Enterprises, crossing the ₹71,000 crore budget target. Coal, power and banking sectors contributed the most to this collection. This revenue can support welfare schemes and infrastructure spending without raising taxes.
Stronger PSU bank profits also signal healthier lending capacity for ordinary borrowers. DFS Secretary M Nagaraju said PSU bank credit growth stood at 12% this year, with deposit growth near 10%. He called banks “the bellwether for the strength of the economy,” citing prudent RBI oversight.
LoansJagat data shows personal loan volumes touched ₹13.7 lakh crore in H1 FY25, though yearly growth eased to 13.8% amid cautious lending. Healthier bank balance sheets could help stabilise this trend.
Analysts link this year's dividend surge to improved asset quality. Net NPAs at banks like Bank of Maharashtra and SBI have fallen below 0.5 percent, well under many private peers, according to a February 2026 PSU sector report. This has allowed banks to distribute a larger profit share to shareholders.
PSU banks paid ₹34,990 crore in total dividends for FY25, with the government’s share at ₹22,699 crore, up from ₹27,830 crore total in FY24. Nagaraju expects combined PSU bank profits to cross ₹2 trillion in FY26. The solution experts propose is continued capital discipline paired with credit growth, so profitability doesn’t come at the cost of lending to smaller borrowers.
The payment of ₹1,553.50 crore by Bank of India is indicative of an overall turnaround in the performance of PSUs in banking in FY26. Profitability levels have risen while NPAs have fallen, along with consistent credit expansion. This implies stability within the banking sector, which may ensure consistent lending going forward.
FAQs
Which rule did Bank of India use to declare a dividend of 1,553.50 crore in 2026?
A total of ₹1,553.50 crore dividend will be paid for FY26 as the board has given approval as it has met the norms of RBI’s capital adequacy and will distribute a dividend of 4.65 per share, i.e. 46.50% on the bank’s net profit of ₹10,527 crore in FY26.
What is the linkage between the June 2026 FII sale and Bank of India like PSU stocks?
The FIIs sold shares worth ₹49,028.63 crore in June 2026, which could affect the PSU banks’ stocks. Despite the sale, Bank of India’s dividend of ₹1,553.50 crore and 14.19% increase in profit.
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