Bank stocks in mutual funds: 17% of equity money

The number

On 31 August 2026, equity mutual funds held ₹6,34,394 crore in Indian bank shares. That was 17.06% of everything they held in shares, and 16.24% of their net assets.

No other industry comes close. Pharmaceuticals and biotechnology, the next largest, was about ₹2.65 lakh crore.

These figures are from the AMCs' monthly portfolio disclosures for 31 August 2026, read for 587 schemes in SEBI's equity categories, one row per scheme. Index funds, ETFs and hybrids are not included. A holding's rupee value is its weight times the scheme's net assets on that date. "Bank" means a company the AMCs file under the Banks industry: 35 of them, held by 469 of the 587 schemes.

Which banks

ICICI Bank and HDFC Bank together are 47.96% of the money funds hold in banks. The five largest are 79.01%. The other 30 banks share the remaining fifth.

Private banks, mostly

Grouped by ownership:

• 19 private banks: ₹5,19,756 crore, 81.93% of the bank money
• 10 public sector banks: ₹90,738 crore, 14.30%
• 6 small finance banks: ₹23,899 crore, 3.77%

SBI accounts for most of the public-sector share on its own. The next largest is Indian Bank, at ₹11,042 crore in 71 schemes. IDBI Bank is counted with the private banks, as the RBI classifies it.

Where the bank weight sits

Each figure below is the category's bank holdings as a share of its net assets, so a large fund counts for more than a small one.

The pattern follows company size. India's largest banks are among its largest companies, so a large-cap fund holds more than a quarter of its money in them while a small-cap fund, which mostly cannot buy them, holds about 7%.

The sectoral average is low because the category mixes banking funds with technology, pharma and consumption funds that own almost no banks. The 28 banking and financial services funds are another matter: 24 of them held between 44% and 63% in banks. UTI Banking and Financial Services Fund was highest, at 63.34%, with most of the rest in lenders (17.00%) and insurers (10.07%).

Among diversified funds, HDFC Focused Fund had the most in banks at 36.96%, followed by DSP ELSS Tax Saver Fund at 36.65% and HDFC ELSS Tax Saver at 33.71%.

What this does not tell you

It is a single month. We have the 31 August 2026 disclosure only, so this shows where money sat, not whether funds were adding to banks or selling them.

The industry label is the AMC's. Bajaj Finance, Shriram Finance and other lenders are filed under Finance, not Banks, and are not counted here. Counting them would make financials a far larger share.

A big weight is not a forecast. Funds hold banks partly because their benchmarks do. None of this is a view on any bank or fund, and it is not a recommendation to buy or sell either.

Where to go from here

Each bank's page lists every scheme that holds it, starting with ICICI Bank and State Bank of India. The guide to banking and financial services funds covers the sector funds that concentrate here.

For the wider picture, see the stocks mutual funds own most, or how large-cap and small-cap funds split their money by sector.

For what the bank index is priced at, see Nifty Bank P/B near its lowest since 2020.