SBI profit down 10% to `18,642 cr on higher base, fall in treasury gains

The country’s  largest lender State Bank of India (SBI) on Saturday reported a 10% drop in net income for the March quarter at `18,642.59 crore as against `20,698.35 crore it had booked in the year-ago period.

The net profit fell despite strong core income growth which got whittled down by lower other incomes, especially from the treasury desk. However sequentially the bank booked a healthy 10.37% jump in net income. Chairman CS Setty told reporters that the bottomline decline was primarily because of exceptionally higher base in the year ago period, along with a surge in provisions for the aging loans.

Loan loss provisions surged 20.35% to `3,964 crore from `3,294 crore, most of which came from aging loans. Despite this, the bank which controls more than a fifth of the system-wide assets at close to `43 trillion and deposits of over 54 trillion brought down its gross bad loans piles to under 2% of the assets at 1.82%, down 43 bps YoY and the net bad loans to under 0.5% at 0.47%, an improvement of 10 bps. Driven by solid loan growth, the bank reported in the core net interest income (NII) of `42,774.55 crore, up 2.8%, the chairman said.