Moneycontrol
Aug 11, 2017 02:06 PM IST | Source: Moneycontrol.com

SBI net profit above estimates but asset quality a drag; top 5 takeaways

State Bank of India and its associate banks reported a consolidated net profit of Rs3032 crore which was higher than the estimate of average analysts’ polled by a CNBC-TV18 estimate of Rs 2485.30 crore.

SBI net profit above estimates but asset quality a drag; top 5 takeaways

Moneycontrol News

State Bank of India (SBI) reported its earnings for the quarter ended June on Friday which was a mixed bag. The net profit came above analysts’ estimates but asset quality remains a drag.

The numbers reported by India’s largest public sector bank is not comparable with that of the previous period because of the merger of associate banks.

The govt approved the scheme of acquisitions of banking subsidiaries such as SBBJ, State Bank of Mysore, State Bank of Travancore, Bhartiya Mahila Bank Ltd, State Bank of Patiala, and State Bank of Hyderabad.

Reacting to the results, the share of SBI pared gains and slipped over 4 percent intraday to Rs 283.70 as of 01:30 PM.

We have collated a list of top five factors from SBI Q1 results:

Net Profit:

State Bank of India and its associate banks reported a consolidated net profit of Rs3032 crore which was higher than the estimate of average analysts’ polled by a CNBC-TV18 estimate of Rs 2485.30 crore.

The largest public sector bank reported a net profit of Rs 1046 crore in the year-ago period.

Net Interest Income:

The Net interest income or the difference between interest earned and interest expended came at Rs 19323 crore for the quarter ended June which was better than the estimate of average analysts’ polled by a CNBC-TV18 of Rs 18,767.20 crore.

The bank reported an NII of Rs 19,673 crore in the corresponding quarter of last fiscal.

Asset Quality:

Gross non-performing assets stood at Rs 1.88 lakh crore or 9.97 percent of gross advances. Net non-performing assets (NPAs) rose to Rs 1.07 crore (Rs 334 crore). In percentage terms, it was 5.97 percent to net advances. Provision coverage ratio was 60.79 percent.

Provisions:

The slower rate of bad loan additions meant that SBI had to set aside Rs 9,869 crore for the quarter ended June as provisions, compared to Rs 13,388 crore set aside in the year-ago period.

Gross Slippage:

The bank had slippages, or fresh additions to bad loans, of Rs 30,059 crore in the three months ended June, compared with Rs 30,669 crore in the March quarter.
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