SBI aims to maintain margins above 3.4% amid stable cost of deposits: Chairman Khara

SBI's CAR stood at 14.28 percent in the March-ended quarter, much above the RBI's prescribed 12 percent-mark for public sector lenders

State Bank of India's (SBI's) Chairman Dinesh Khara outlined plans to maintain margins above 3.43 percent moving forward, despite reporting a 37 basis points (bps) year-on-year (YoY) margin squeeze in the January-March quarter (Q4FY24).

"We don't expect net interest margins (NIMs) to undergo any significant change going forward, but most of the cost of deposits has already plateaued in October and December. The bank's efforts will be towards maintaining margins in the same range as reported in the March-ended quarter," Khara said in a post-result analyst conference call.

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The public-sector lender's NIMs stood at 3.47 percent in Q4FY24, down 37 bps from 3.84 percent in Q4FY23. However, NIMs expanded by 13 bps sequentially from 3.34 percent in Q3FY24.

Additionally, SBI's net profit rose by 24 percent YoY to Rs 20,698 crore in Q4FY24, aided by strong loan growth, while net interest income rose by 3.1 percent YoY to Rs 41,656 crore.

The asset quality of the bank improved in the March-ended quarter. Net NPA declined by 10 bps YoY to 0.57 percent in Q4FY24 from 0.67 percent in Q4FY23. SBI also declared a dividend of Rs 13.7 per equity share for FY24.

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Following its upbeat Q4 results, shares of SBI gained over 3 percent to hit a fresh 52-week high of Rs 839.6 per share on May 9.

So far this year, shares of SBI have surged over 27 percent, outperforming a paltry 1 percent rise in the benchmark Nifty 50 index during the same period.

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