State Bank of India said that it expects to arrest slippages going ahead as the stress in its corporate loan book has been taken care of. However, the country's largest lender pared its credit growth target amid concerns on current economic conditions.
"The corporate book seems to be very normal. No large ticket loan under stress and within retail, housing loans, car loans and personal loans, are all doing very well. There is no issue," said Rajnish Kumar, Chairman, SBI. He added that there has been no major change in SME loans, while agriculture loans slippage is about Rs 3,000 crore average every quarter.
SBI expects slippages of Rs 5,000-6,000 crore in the January-March quarter.
"Going forward, if we maintain the same trend, then expectation is that we should be able to have a normalise number of between Rs 30,000-35,000 crore," Kumar added.
The bank saw slippages of Rs 16,525 crore in the third quarter, including Rs 7000 crore from its exposure to Dewan Housing Finance Corporation. Slippages were much higher as compared to Rs 8,805 crore seen in the second quarter and Rs 4,523 crore seen in the third quarter last year.
The bank's Special Mention Accounts (SMA) 1 and 2, which is a list of stressed accounts, shrunk to Rs 8,101 crore in December-ended quarter, from Rs 18,313 crore from the previous quarter and Rs 17,059 crore from the same period last year.
Its gross non-performing assets (NPAs) ratio and net NPA ratio eased to 6.94 percent and 2.65 percent in the third quarter, from 8.71 percent and 3.95 percent in the same period last year, respectively.
SBI registered a credit growth of 6.79 percent, led by rise of 17.49 percent in personal loans in the third quarter. It expects credit growth below 10 percent by end of current financial year.
The bank posted a record high quarterly profit of Rs 5,583 crore in the October-December period, on account of recovery of around Rs 11,000 crore in the Essar Steel account.
In the January-March quarter, the bank expects recoveries of about Rs 7000 crore from three accounts that includes a steel and a textile company.
