SBI posts record quarterly profit as bad loan provisions drop
The net profit jumped to 55.83 billion rupees ($785.56 million) in the three months to December 31, from 39.55 billion rupees a year earlier
State Bank of India (SBI) on Friday reported its biggest ever quarterly profit on lower bad loan provisions and better asset quality, sending its shares up over 3%.
Net profit jumped to 55.83 billion rupees ($785.56 million) in the three months to Dec. 31, from 39.55 billion rupees a year earlier. That missed analysts’ estimates for a profit of 63.34 billion rupees, according to Refinitiv data, due to a higher tax expense.
Provisions for bad loans dropped 41.4%, while gross bad loans as a percentage of total loans, a measure of asset quality, slipped to 6.94% at December-end from 7.19% in the immediately previous quarter, the Mumbai-based bank said in a regulatory filing.
SBI’s shares rose as much as 3.5% in a Mumbai market that was trading 0.1% lower as of 0830 GMT.
Quarterly net interest income rose 22.42%, while net interest margin, a key indicator of a bank’s profitability, rose to 3.59%, up 37 basis points from the previous quarter.
Slippages, or fresh addition of bad loans, surged to 165.25 billion rupees from 88.05 billion rupees in the previous quarter, due to a 70 billion rupee exposure to a large housing finance company, SBI said.
