India’s largest lender State Bank of India (SBI) today reported standalone second quarter net profit of ₹7,626 crore, which is the highest ever for the Bank, up 67% over last year. This compares with ₹4,574 crore in the corresponding quarter of last year (Q2FY21).
On Wednesday, SBI shares were up 3.86% in noon deals at ₹541.85 apiece on NSE. SBI scrip has comfortably outperformed the Nifty Bank and Nifty50 indices, rising 86.83% so far in 2021 (Year-to-Date). In the same period, Bank Nifty and Nifty rose 27.90% and 27.61% respectively.
In the last one year, the index heavyweight has rallied 154.95% as compared to 55.51% surge in Bank Nifty and 51.43% growth in Nifty50.
On a sequential basis, the profit rose 17% from ₹6,504 crore in the June quarter.
The state-owned lender’s net interest income (NII) — the difference between interest earned and expended — rose 10.6% to ₹31,184 crore for the reporting period.
SBI has incurred an exceptional item during the second quarter after it fully provisioned ₹7,418 crore on account of change in family pension rules, even as regulator granted dispensation to amortise in 5 years.
The net interest margin (NIM) of the lender during the September quarter rose 16 basis points to 3.50%.
SBI’s operating profit increased by 9.84% year-on-year to ₹18,079 crore in the second quarter from ₹16,460 crore in the last year period.
On the asset quality front, gross non performing assets (NPAs) came in at 4.90% in the September quarter, lower than 5.32% in the June quarter and 5.28% in the last year same quarter.
The non interest income of the Bank fell 3.7% to ₹8,207 crore in the second quarter as compared to ₹8,527 crore in the same period a year earlier.
Meanwhile, the net NPA ratio stood at 1.52% for the quarter under review.
Loan loss provisions during the quarter fell sharply to ₹2,699 crore, down over 55% from ₹5,619 crore in the last year period.
The Bank’s advances during the quarter rose by 6.17% over last year, mainly driven by personal retail advances (15.17% YoY) and foreign office advances (16.18% YoY).
Meanwhile, domestic advances growth stood at 4.61% for the period under review. Home loans, which constitute 24% of Bank’s domestic advances, has grown by 10.74% year-on-year.
SBI’s provision coverage ratio (PCR) is at 87.68% in the second quarter, while slippage ratio for the same period stood at 0.66% only, down from 2.47% in previous June quarter.
The Bank’s total deposits grew at nearly 10% when compared with last year, while current account deposits grew by 19.2% year-on-year and saving bank deposits grew by 10.55% year-on-year.
The Bank’s capital adequacy ratio (CAR) at the end of September quarter came in at 13.35% even without including first half profit.
Other highlights of SBI performance in second quarter
Credit Cost for the second quarter has declined 51 basis points to 0.43%, when compared with last year.
Cost to income ratio during the quarter stood at 54.10% and it is lower by 106 basis points as compared to same period a year earlier.
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