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SBI Q3 net profit down 34 pct at Rs 2,234 crore on bad loans

SBI, country's largest lender, has seen its profit slump on rise in bad loans by 24 pct.

SBI SBI net profit falls more than a third to Rs 2,234 crore in the quarter ended December.

State Bank of India (SBI) today reported net profit worth Rs 2234.34 crore for the quarter ended December 31, down 34% from a year ago, on higher bad loans and increased provisioning. The bank saw provisions worth Rs 3,429 crore for non-performing assets (NPA) during the quarter, up 24% from a year ago.
Net interest income (NII) for the quarter rose 13.3% from a year ago to Rs 12,640.52 crore. The bank’s operating profit during the three month period stood at Rs 7618 crore, down 2% from the previous year. Total income rose 15% yoy to Rs 39,061 crore in the October-December period. At 2PM, Friday, SBI stock was down 3% on Bombay Stock Exchange, at Rs 1,459 a piece.
Domestic net interest margin (NIM) stood at 3.51% unchanged on a quarter-on-quarter basis.
Asset quality worsened as gross NPA as a ratio to total assets rose 9 basis points sequentially to 5.73%. Gross NPAs during the quarter stood at Rs 67,799 crore, up 5.6% quarter-on-quarter. Net NPA ratio rose 33 bps sequentially to 3.24% as on December 31.
SBI Q3 net profit falls 34% y-o-y
State Bank of India (SBI) today posted a 34 per cent decline in net profit at Rs 2,234.34 crore for the third quarter ended December 31, 2013 on account of higher provisioning for bad loans.
The country’s largest bank had a net profit of Rs 3,396 crore on standalone basis in the October-December quarter of 2012-13.
The total provisioning for non-performing assets rose to Rs 3,428.59 crore during the December quarter, up from Rs 2,766.18 crore in the corresponding period last fiscal, SBI said in a filing on the BSE
Total income of the bank rose to Rs 39,061 crore during the third quarter from Rs 33,992 crore in the same period a year ago.
The gross Non-performing Assets (NPAs), which represents portion of bad loans, stood at Rs 67,799.33 crore at the end of December, up from Rs 53,457 crore in the year ago period.
As of December 31, the bank’s portfolio quality declined, with gross NPAs at 5.73 per cent of gross advances, as against 5.30 per cent a year ago.
Its net NPAs during the third quarter rose to 3.24 per cent, from 2.59 per cent in the period a year earlier.
On a consolidated basis, the SBI group net profit plummeted by 40 per cent to Rs 2,838 crore during the October-December quarter. It was at Rs 4,648 crore in the year ago period.
Shares of SBI were trading at Rs 1,460.80, down 2.59 per cent in the afternoon trade on the BSE.
During the three quarters (April-December) of 2013-14, the bank’s net profit on standalone basis declined by 27 per cent to Rs 7,850.43 crore, as against Rs 10,805.76 crore in same period of 2012-13.
Its total income rose to Rs 1,12,493.42 crore in the nine months, from Rs 99,361.07 crore in the year-ago period.

FE Bureau

SBI Q3 net profit dips 34 pc at Rs 2,234 crore
(Reuters) State Bank of India (SBI) , the country’s largest lender, on Friday posted a fourth straight consecutive drop in net income as an increase in bad loans clipped profitability.
SBI followed its state-run peers Punjab National Bank, Canara Bank and Bank of India in posting weak profits amid high defaults by corporates battling reduced cashflows, high inflation and delays in government approvals for projects.
SBI said on Friday that net profit fell more than a third to 22.34 billion rupees ($358.21 million) in the quarter ended December, lagging analysts’ estimate of 25.3 billion rupees.
Non-performing loans as a percentage of total assets rose to 5.7 per cent from 5.6 per cent in the preceding quarter.
Last month, India’s top private sector lender ICICI Bank warned that corporate defaults would rise in the coming quarters as borrowers succumb to the pressure of a sluggish economy. ICICI posted its slowest profit growth in four years in the December quarter.
SBI shares, valued by the market at about $17 billion, were trading down 1.3 percent at 1,485 rupees.

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