SBI first half profit rises by 21.71%

He said net non-performing assets (NPAs) were slightly up from 6.07 per cent as on March 31, 1998 to 6.10 per cent at the end of September 1998, he said, adding asset quality is going to provide a tough time for banks requiring “tough monitoring”.

Verma said the accrual of the NPAs can be attributed to the overall situation in the industry. “I believe with the kind ofrecoveries being made and the write-offs on the anvil, NPAs might increase only marginally,” Verma said.

However, according to Verma, the overall asset quality of the bank has remained the same as it was last year. There has been a fall in the number the top credit-worthy companies of the bank during last two years, Verma said.

“There has been a fall of one to per cent of in the number of companies which were enjoying the top credit rating of the bank,” he said adding that bank has seven slab rating system for assessing the risk of corporates. “Our NPA management system is a detailed one,” Verma said, adding that the bank keeps on changing the rating of companies on the basis of their credit-worthiness.

Further, according to Verma, the bank will keep a watch over all segments and sub-segments to prevent any undue rise in NPA. Of the total provisioning of Rs 816.32 crore for April-September 1998 (Rs 658 crore in the corresponding period of last year), Rs 335 crore was provided for bad debts and Rs137.44 crore for investment depreciation.

He said unlike last year, SBI would not revise downwards its assets growth target of 16 per cent in view of the expected disbursement to infrastructure projects, the signs of rejuvenation in certain industrial sectors and the focus on housing loans and consumer finance in the personal segment.

Global deposits of the bank stood at Rs 1,42,556 crore as on September 30, 1998, showing a rise of 8.7 per cent over the figure as on March 31, 1998. The bank’s domestic deposits stood at Rs 1,35,000 crore, recording a growth of 9.3 per cent.

Verma said the bank’s global advances touched Rs 71,391 crore as of September 1998, registering a fall of 3.8 per cent over the previous year. net domestic advances also declined by 2.9 per cent at Rs 62,296 crore. The bank’s corporate accounts group sanctioned Rs 3,500 crore of increase in the limits/new facilities in the first half of 1998-99.