© IE Online Media Services Pvt Ltd
Tags:
Journalism of Courage
The country’s largest lender, State Bank of India (SBI), reported its highest-ever quarterly profit after tax (PAT) in the three-month period ending June at Rs 16,884 crore. This was driven by a fall in non-performing assets (NPA), higher loan growth and lower provisions.
The lender’s net profit in the year-ago quarter was Rs 6,068 crore.
In the current financial year, SBI is expecting credit growth of 14-16 per cent and deposit growth of 13-14 per cent.
“I have been maintaining a 14-16 per cent credit growth and I will stick to the number because we normally look at it in terms of the nominal growth of the economy and we should be growing at a faster rate,” SBI Chairman Dinesh Khara said.
In the April-June quarter, the bank’s gross advances grew by 13.9 per cent to Rs 33,03,731 crore. Its corporate loan book registered a growth of 12.38 per cent and retail loans increased by 16.46 per cent.
Khara said the demand for corporate loans is seen coming from the manufacturing, road and infrastructure, and renewable energy sectors.
“When it comes to corporates, we are open to all kinds of opportunities such as renewable, services and infrastructure. But it should be in our risk appetite,” Khara said.
The bank will be selective in growing its international books owing to uncertain conditions in the overseas market, he added.
SBI’s deposits increased by 12 per cent in the first quarter. Going ahead, the bank said it will be mindful of the cost at which it grows deposits.
“I am still having excess SLR (statutory liquidity ratio) of Rs 4 trillion. I am under no compulsion to pay up high to mobilise deposits. But, I will be very reasonable for my customers,” Khara said.
SLR is the minimum percentage of deposits that banks have to maintain in the form of liquid cash, gold or other securities.
In the April-June quarter, the bank’s net interest income grew by 24.71 per cent to Rs 38,905 crore. Net interest margin stood at 3.47 per cent compared to 3.23 per cent in the same period last year.
SBI’s asset quality improved, with gross non-performing assets (NPAs) declining to 2.76 per cent from 3.91 per cent. Net NPAs eased to 0.71 per cent from 1 per cent. The bank expects net NPAs to decline to 0.5 per cent in the current financial year.
Recovery and upgradation in the quarter stood at Rs 3,607 crore.
Fresh slippages were at Rs 7,659 crore. Khara said slippages were mainly from the small and medium enterprise and agriculture segments.
Loan loss provisions declined by 38 per cent to Rs 2,652 crore in Q1 from Rs 4,268 crore in the year-ago period.
