State Bank of India suffered an 18.5 per cent drop in its net profit to Rs.3,299 crore during the fourth quarter ended March 31, 2013, from Rs.4,050 crore a year ago.
However, for the whole of 2012-13, the net profit rose by 20.5 per cent to Rs.14,105 crore.
Addressing a press conference here on Thursday after a board meeting, Chairman Pratip Chaudhuri described the results as a mixed bag saying that the bank had significantly enhanced its provisioning.
“We have tried to protect investor interest, and we have significantly enhanced the provision coverage ratio (at 66.58 per cent in the March quarter against 61.5 in the previous quarter)”.
Rs.41.50 dividend
A dividend of Rs.41.5 per share was declared, Mr. Chaudhuri said.
Net interest income was 4.42 per cent lower at Rs.11,078 crore during the quarter under review, although for the year it showed a 2.4 per cent growth at Rs.44,331 crore.
Boosted by a 11.7 per cent rise in non-interest income, total operating income rose by 4.73 per cent during 2012-13 touching Rs.60,366 crore.
“We are operating under challenging circumstances,” the chairman said adding that non-performing assets in agriculture, mid-corporates and small and medium enterprises were still a challenge.
During the last quarter, fresh slippage of Rs.5,868 crore was noticed. He said that it was a long haul for corporates, and there were many accounts in the substandard category.
“There was no significant buoyancy in investment,” he said.
“Corporate India is facing a demand constraint as against a supply constraint earlier,” Mr. Chaudhuri said, and added that there were over-capacities in sectors such as hotels.
Asset quality
Referring to asset quality, he said that SBI’s gross NPA had begun to show a declining trend. He said that against 5.3 in the quarter-ended December 2012, the figure stood at 4.75 in the quarter ending March 2013. Net NPA at 2.1 had stabilised, he said.
He said that SBI’s equity portfolio had been totally overhauled, and was well positioned now. He also said that the bank was reviewing its commission structure for letters of credit.
Deposit growth
SBI, which saw a 15.24 per cent growth in its deposits, which touched Rs.10,43,647 crore, was targeting a 25 per cent growth in the current fiscal. Loan growth, however, was a function of the market, Mr. Chaudhuri said.
To a question on raising capital, the chairman said that there were several options, including raising new capital.
“Even with new capital, the public sector nature of the bank will remain,” Mr. Chaudhuri said. The government now holds 62.3 per cent of SBI’s equity.
Consolidated results
The net profit of the five associate banks and subsidiaries increased from Rs.3,627 crore in 2011-12 to Rs.3,678 crore in 2012-13 with the consolidated profit showing a 16.7 per cent rise at Rs.17,916 crore.
