State Bank of India (SBI), the country’s largest lender, on Friday reported a stand-alone profit of Rs 2,312.20 crore for the first quarter ended June (Q1) compared with a loss of Rs 4,875.85 crore in the year-ago quarter on the back of lower provisions.
The stock, however, dropped nearly 3% to Rs 308.25 in afternoon trade immediately after the earnings announcement.
Here are key takeaways from SBI’s Q1 earnings:
- SBI’s net interest income (NII) grew by 5.2% year-on-year to Rs 22,938.8 crore in the June quarter.
- The bank’s loan growth during the June quarter stood at 13.8% year-on-year.
- SBI’s operating profit increased 10.6% year-on-year to Rs 13,246.2 crore.
- Domestic net interest margin (NIM) in the June quarter contracted 1 basis point sequentially to 3.01%, but expanded 6 basis points when compared with a year ago.
- Asset quality was stable, with gross non-performing assets (NPAs) as a percentage of gross advances flat at 7.53% in the June quarter compared with the previous March quarter. Net NPA as a percentage of net advances, however, rose 6 basis points sequentially to 3.07%.
- Gross slippages during the June quarter stood at Rs 16,212 crore, increasing by a huge 62.4% year-on-year and 116% sequentially. Consequently, slippage ratio increased significantly to 2.83% in the June quarter from 1.39% in the March quarter.
- Provisions for bad loans fell 32.8% sequentially and 10.65% year-on-year to Rs 11,648.5 crore in the June quarter.
- Provision coverage ratio also improved to 79.34% at the end of June 2019 from 78.7% at the end of March 2019 and 69.25% as of June 2018.
- SBI’s other income during the quarter grew by 20% to Rs 8,015.4 crore compared to the year-ago quarter.
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