India’s largest lender, the State Bank of India (SBI) reported a 69.82% rise in its third quarter (Q3) net profit on the back of a 34% rise in interest income and 48% growth in other income, including treasury income.
India’s second largest lender, private sector ICICI Bank Ltd, last week reported a 35% rise in net profit for the same period.
The public sector lender’s net profit for the quarter ending December was Rs1,808.64 crore, against Rs1,065.06 crore in the year-ago period. Interest earned stood at Rs12,666.81 crore—up from Rs9,446.36 crore a year ago, while other income, which includes trading profits from bond and equities, rose to Rs2,697.19 crore from Rs1,822.02 crore from the same period last year.
Total income for the quarter increased to Rs15,364.0 crore, from Rs11,268.38 crore in the year-ago period.
SBI’s operating profit for the quarter, before provisions and contingencies, at Rs3,659.74, rose 55.75%.
However, its net profit rose at a higher rate because the bank had made lower provision for non-performing assets (NPAs) at Rs444.12 crore, against Rs698.26 crore in the year-ago quarter. Its NPAs as a percentage of total advances remained almost flat at 1.44%.
For the nine-month period, the bank’s net profit grew 59% to Rs4,845.87 crore.
Net interest income, or the difference between interest earned and interest expended, for the nine-month period rose 16.26% to Rs12,220.64 crore against Rs10,511.49 crore in the corresponding period from last fiscal year.
The net interest margin, a measure of a bank’s returns in its core business of borrowing and lending, stood at 3.01%.
SBI’s deposit portfolio for the nine-month grew by 26.16%, to Rs5,10,132 crore, from Rs404,352 crore.
The low-cost current and savings account (CASA) increased from Rs1,71,202 crore to Rs2,02,642 crore, taking the CASA ratio to 41.05%.
SBI announced it has agreed to buy a controlling stake in Global Trade Finance Ltd for Rs521 crore to tap growing export financing in Asia’s third biggest economy. Global Trade provides financing to importers and exporters.
SBI’s stock rose 0.94%, or Rs21.75, to close at Rs2,345.9 on the Bombay Stock Exchange even as the Bankex, the 18-stock index for banking industry, fell 1.38%.
PTI contributed to this story.