Moneycontrol Bureau
State Bank of India, the country's largest lender, has reported profit at Rs 2,610 crore in October-December quarter, a whopping 134 percent growth over Rs 1,115.34 crore in year-ago quarter. Strong growth was on account of low base in Q3FY16 that had impacted by provisions. Profitability was also driven by other income (including profit on stake sale in SBI Life) and operating profit.
Net interest income, the difference between interest earned and interest expended, grew by 7.7 percent year-on-year to Rs 14,754.54 crore in the quarter ended December 2016, with loan growth of 4.06 percent (1 percent sequential) at Rs 14.47 lakh crore YoY and net interest margin down 19 bps (down 2 bps QoQ) at 3.03 percent.
Loan growth was impacted by slow growth in corporate book (up 2.36 percent YoY), and degrowth in mid corporate accounts (down 4.48 percent) & SME (down 11.04 percent) but was supported by retail advances that increased 17.5 percent to Rs 3.62 lakh crore.
Total deposits during the quarter jumped 22.1 percent to Rs 20.40 lakh crore compared with corresponding period of last fiscal and sequentially increased 9.7 percent, with current & saving accounts deposits growing 34.74 percent to Rs 9.08 lakh crore, the public sector lender said. It was largely due to demonetisation money.
The bank further said CASA ratio increased by 385 bps YoY and 381 bps QoQ to 46.55 percent as on December 16.
Earnings beat analysts' expectations. Profit was expected at Rs 2,496 crore and net interest income at Rs 14,452 crore for the quarter, according to average of estimates of analysts polled by CNBC-TV18.
Non-interest income (other income) during the quarter shot up 58.73 percent to Rs 9,661.92 crore. "The major contributors to non-interest income were growth in profit on sale of investments, fee income, forex income and recovery in written off accounts," SBI said.
During the quarter, the bank sold 3.90 percent stake in SBI Life for Rs 1,755 crore. Excluding this, growth in non-interest income would have been 29.90 percent, it said.
Operating profit grew by 30.7 percent to Rs 12,543.26 crore on year-on-year basis while operating expenses increased 16.53 percent to Rs 11,870 crore in Q3FY17.
Overall asset quality was stable, though slightly weakened. Gross non-performing assets as a percentage of gross advances increased 9 basis points to 7.23 percent and net NPAs rose 5 basis points to 4.24 percent compared with previous quarter.
Gross NPAs, in absolute terms, were up 2.2 percent at Rs 1.08 lakh crore and net NPAs rose 2.4 percent to Rs 61,430 crore on quarter-on-quarter basis.
SBI said provisions and contingencies increased 13.2 percent sequentially and 12.5 percent year-on-year to Rs 8,943 crore while provisions for non-performing assets fell 5.5 percent quarter-on-quarter and 5.2 percent year-on-year to Rs 7,244.55 crore in the quarter gone by.
Provisions coverage ratio at the end of December quarter stood at 62.87 percent, improved from 62.12 percent as on September quarter, it said.
Fresh slippages for the quarter came in at Rs 10,185 crore, which were slightly lower compared with Rs 10,341 crore in previous quarter.
State Bank of India's recoveries during the quarter stood at Rs 1,003 crore, which were lower against Rs 1,344 crore in September quarter but upgrades increased to Rs 1,059 crore from Rs 206 crore QoQ.
At 13:32 hours IST, the stock was quoting at Rs 278.75, up Rs 2.90, or 1.05 percent on the BSE.
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