State Bank of India (Reuters)
State Bank of India (Reuters)

SBI reports net profit of 5,583 crore in Q3, up 41% YoY

  • Net interest income was 27,778.79, up 22.4% from the same period last year.

Mumbai: State Bank of India (SBI), India’s largest lender, on Friday reported a 41.2% year-on-year jump in its October-December net profit to 5,583 crore, led by higher interest and other income.

While the bank’s interest income rose 8.6% year-on-year (y-o-y) to 67,692 crore, its other income increased 13.3% to 9,106 crore during the reporting quarter.

SBI’s net profit was lower than the 5,871.6 crore estimated by a Bloomberg poll of 13 analysts. The bank’s net interest income – difference between interest earned and expended – stood at 27,778.79, up 22.4% from the same period last year.

The bank's asset quality improved in the third quarter of FY20, with gross non-performing assets (NPAs) as a percentage of total advances at 6.94%, down 177 basis points (bps) y-o-y, and 25 bps sequentially. In absolute terms, bank’s gross NPAs declined 15% y-o-y to 1.59 trillion.

Its capital adequacy ratio under Basel III norms stood at 13.73%, up 96 bps y-o-y and 14 bps from a quarter ago.

SBI had disclosed in December that a Reserve Bank of India’s (RBI) inspection found that it underreported bad loans and their provisioning by 11,932 crore and 12,036 crore, respectively, in 2018-19. It said, on Friday, that it has made full provisions against the divergence in the December quarter.

The lender also said it has made a provision of 602 crore in the quarter ended December (total cumulative till December is 8,237.4 crore) towards arrears of wages due for revision, effective 1 November, 2017.

The Indian Banks’ Association (IBA) and bank unions are, at present, negotiating a pay hike and benefits to bank employees. IBA has said while it was unable to accept the bank unions’ demand for a 5-day work week, it has offered a 19% pay hike to employees.

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