Mumbai: Riding on lower provisioning and improved asset quality, state-run State Bank of India SBI) on Friday reported a net profit of Rs 2,312 crore during the first quarter ending June against a net loss of Rs 4,876 crore during same period of 2018-19.
India’s largest lender’s April-June profit was 176 per cent higher sequentially over the net profit registered during the fourth quarter of the last fiscal. In the January-March quarter, the bank reported a net profit of Rs 838.40 crore.
Though the bank’s bottomline jumped substantially, its gross slippage during the quarter in consideration stood at a five-quarter high of Rs 16,212 crore, against Rs 7,961 crore in the previous quarter.
The asset quality in the June quarter was stable with gross non-performing assets (NPAs) as a percentage of gross advances flat at 7.53 per cent compared to the previous quarter, though net NPAs as a percentage of net advances inched up by 6 basis points (bps) sequentially to 3.07 per cent.
The operating profit increased by 10.63 per cent over the same quarter last year. Excluding the one-off item in the first quarter of 2018-19, operating profit has increased year-on-year (YoY) by 31.89 per cent.
Net interest income (NII) during the quarter in consideration grew by 5.23 per cent YoY. Excluding the one-off item the the corresponding quarter last year, NII saw healthy growth at 5.45 per cent YoY. NII had grown 5.2 per cent year-on-year to Rs 22,938.8 crore in June quarter of 2018-19.
The bank’s domestic Net Interest Margin in the first quarter increased to 3.01 per cent.
The Gross NPA (GNPA) ratio at 7.53 per cent was down 316 bps YoY. The GNPA in absolute terms has declined both sequentially as well as YoY. The Net NPA Ratio at 3.07 per cent was down 222 bps YoY. Net NPA in absolute terms has declined both sequentially as well as YoY.
The provision coverage ratio (PCR) improved significantly by 1009 bps, from 69.25 per cent in June 2018 to 79.34 per cent in June 2019. The PCR also improved to 79.34 per cent at the end of June 2019, from 78.7 per cent in March 2019.
The credit cost in the first quarter was at 2.03 per cent, down 52 bps YoY.
Provisions for bad loans, or NPAs, in the first quarter fell significantly by 32.80 per cent quarter-on-quarter to Rs 11,648.5 crore. It declined 10.65 per cent YoY.
Provisions and contingencies at Rs 9,183 crore were lower by 44 per cent sequentially and 52.2 per cent year-on-year, the bank said.
The lender also said it had been holding a provision of Rs 3,553 crore for accounts covered under the Insolvency and Bankruptcy Code (IBC) and had made provision of Rs 996 crore on account of wage arrears.
The SBI stock was trading lower on the BSE by 1.32 per cent at Rs 313.90 a share at 2.45 p.m. on Friday.