State Bank of India (SBI) reported first quarter net profit surged 178.25% to ₹16,884 crore as compared with ₹6,068 crore a year earlier on account of improvement in asset quality and loan growth. This is the bank’s highest-ever net profit.
“The high profit is due to lower Non Performing Assets (NPA), lower provisioning and increase in the loan book,” Dinesh Khara, Chairman, SBI said at a press conference.
During the quarter ended June 30, 2023, the bank’s Net Interest Income (NII) increased by 24.71% year-over-year (YoY) to ₹38,905 crore. The Net Interest Margin was 3.47% as compared with 3.23% a year earlier, up 24 basis points (bps). Loan loss provision during the quarter was down 38% at ₹2,652 crore.
Mr. Khara said the quarter witnessed credit growth of 13.90% YoY with domestic advances growing at 15.08% YoY. Domestic advances growth was driven by SME advances (18.27% YoY) followed by personal retail advances which grew 16.46% YoY. The bank’s home loan, auto loan and Xpress credit was up 13.47%, 22.97%, and 19.75%, respectively. “There was robust growth across segments,” Mr. Khara said.
He said credit growth is expected to be 14% to 16% during this financial year.
Stating that there was certain stress in the SME and Agri loan book, he said the Gross NPA ratio at 2.76% was down 115 bps YoY. The Net NPA ratio at 0.71% was down by 29 bps YoY.
Slippages ratio for the quarter improved by 44 bps YoY and stood at 0.94%.
Total restructuring as on June 2023 was ₹22,666 crore as compared with ₹24,302 crore a year earlier.
The bank said it had a total provision of ₹8,413 crore during the quarter as compared with ₹6,684 crore a year earlier, up 25.85%.
Provision for employees was ₹5,960 crore during the quarter as compared with ₹2,557 crore in the year earlier period. The bank has been making such provisions as a wage hike is due later during the year.
Gross NPA was down at ₹91,328 crore as compared with ₹1,13,272 crore a year earlier. And Net NPA was down at ₹22,995 crore as compared with ₹28,258 crore a year earlier.
Slippages were down at ₹7,659 crore as compared with ₹9,740 crore in the year-earlier period.
The bank’s Capital Adequacy Ratio (CAR) at the end of the quarter improved by 113 bps YoY and stood at 14.56%
Mr. Khara said the bank would continue to lend to all segments to meet the requirement of the economy. “In the corporate sector we are open to any opportunity,” he said.
