State Bank of India’s quarterly numbers were the worst in over a decade, shocking analysts and markets. The bank posted a 99% drop in net profit to a just Rs21 crore. The disappointing earnings came on the back of high provisioning, both for bad assets and retirement benefits. Total provisioning shot up 82% to Rs6,059 crore. Chairman Pratip Chaudhuri said sticky assets were one of the bank’s biggest concerns in the coming months.
But there was also good news for SBI. Its net interest margin actually gained, going to 3.32% from 2.26% in the previous year’s fourth quarter.
Moving on to the economy, new figures show inflation is easing, but remains stubbornly high. Numbers for April’s wholesale price index out on Monday were high than most estimates. It rose 8.66% on a year-on-year basis. The revised figure for March is 9.04%. Inflation remains a major concern for the government as it considers a cut in fuel subsidies. Finance minister Pranab Mukherjee has already warned recent hikes in petrol prices will have an impact on inflation.
On a more positive note, food inflation has continued to slow down. The food price index stood at 7.47% during the period to 7 May. That’s compared to the 7.7% rise the previous week.
Kanimozhi is behind bars. On Friday the special CBI court denied her bail application in the 2G spectrum scandal along with that of Kalaignar TV’s head Sharad Kumar. They’ll both now remain in custody while the 2G trial continues.