Sticking to overall credit growth target of 14-16% for FY2025: SBI Chairman

“Based on the visibility we have on the corporate loan pipeline as well as in terms of what we see in the month of January in retail and home loans, we are confident that we will be sticking to the (credit growth) guidance of 14-16 per cent,” Setty told reporters.

The lender has a corporate loan pipeline of Rs 4.83 lakh crore.

In the quarter ended December 2024, the country’s largest lender reported a 13.49 per cent jump in gross advances, with growth in domestic corporate loan book at 14.86 per cent and retail personal loans at 11.65 per cent. The lender’s home loans grew 14.26 per cent in the quarter-ended December 2024.

Its deposits increased by 9.81 per cent year-on-year, out of which CASA (current account savings account) deposits grew by 4.46 per cent.

When asked about private capital expenditure, Setty said it was happening across sectors. However, in the core sectors, particularly in the steel, private capex was yet to pick up.

“People are looking at the global playout and how it is going to be…this tariff regime. Our view is that the budgetary proposition in terms of spurring the demand domestically, particularly consumption, should make many of the industries which are not currently undertaking capital expenditure, despite reaching 70-75 per cent capacity utilisation, rethink on that…” Setty said.

He said the increase in personal income tax exemption limit and rationalisation in tax deduction at source (TDS) on fixed deposits for senior citizens and others, announced in the Union Budget 2025-26, would lead to an increase in disposable income. A part of this income would go for consumption, part of it to investments and some of it would come to banks in the form of deposits.

In the Budget, Finance Minister Nirmala Sitharaman had announced to increase the personal income tax exemption limit to Rs 12 lakh crore. The TDS threshold on interest earned from fixed deposits for senior citizens has been doubled to Rs one lakh from FY 2025-26.

“This is definitely a positive development for the banking system in terms of deposits. It is difficult to put a figure right away. There are a large number of customers in our portfolio in the Rs 12 lakh income bracket. Reduction in TDS for senior citizens is also very positive,” Setty said.

Earlier this week, Financial Services Secretary M Nagaraju said the government expects income tax-related measures announced in the Budget to lead to additional bank deposits of Rs 40,000-45,000 crore.

In the quarter ended December 2024, SBI reported a net profit of Rs 16,891 crore, an year-on-year growth of Rs 9,164 crore in December 2023 quarter.

“While we have improved on every parameter, the substantial jump in profit (in Q3 FY2025) is also because there was a one-time exceptional item in Q3 FY2024,” Setty explained.

The exceptional item in Q3FY2024 was related to provisions on account of one-time increase in pension liabilities at uniform rate of 50 per cent and dearness relief (DR) neutralisation.

In Q3 FY2025, the lender’s net interest income (NII) increased by 4.09 per cent to Rs 41,446 crore from Rs 39,816 crore in the same quarter of the previous fiscal.

Domestic net interest margin (NIM) moderated by 19 basis points to 3.15 per cent from 3.34 per cent in the year-ago quarter.

The bank’s gross non-performing ratio (GNPA) improved to 2.07 per cent from 2.42 per cent. Net NPA stood at 0.53 per cent, as against 0.64 per cent. Fresh slippages declined to Rs 3,823 crore in Q3 FY2025, compared to Rs 4,960 crore in the year-ago quarter.

The bank’s scrip declined 1.79 per cent to close at Rs 752.35 apiece.