SBI Q2 profit jumps 67% as asset quality improves
5paisa Research Team
Last Updated: 3rd November 2021 - 03:45 pm
State Bank of India (SBI) on Wednesday reported improvement in its asset quality and high earnings growth for the second quarter, powered by lower provisioning as expected by analysts.
India’s largest lender also said its net interest income (NII) rose in double digits while advances grew at a modest pace during the quarter through September.
SBI reported a net profit of Rs 7,627 crore, up 67% from Rs 4,574 crore in the second quarter of last year and an increase of 17% sequentially from Rs 6,504 crore in the preceding quarter ended June 30.
This is more or less in line with expectations even though some brokerage houses were estimating the net profit to rise by as much as 100%.
Net interest income grew 10.65% year-on-year and 12.83% compared with the first quarter to Rs 31,184 crore for the July-September period. The growth was over twice what analysts were anticipating.
The state-controlled lender’s share price shot up after it declared its results before moderating a bit and was trading at Rs 528.55 apiece, up 1.3% at 2.50 PM in a weak Mumbai market on Wednesday.
SBI Q2: Other highlights
1) Operating profit increased by 9.84% YoY to Rs 18,079 crore in Q2 from Rs 16,460 crore a year earlier.
2) Net NPA ratio at 1.52% was down 7 basis points YoY; Gross NPA ratio at 4.90% was down 38 bps YoY.
3) Total deposits grew 9.77% YoY; current account deposits grew 19.20% saving bank deposits grew 10.55%.
4) Domestic gross advances were up 6.17% but corporate loans remained weak with advances down 4%.
5) Retail loans grew 15.17% partly thanks to a 10.74% rise in home loans.
6) Credit cost for Q2 declined 51 basis points YoY to 0.43%.
7) Loan loss provision halved to Rs 2,699 crore during the quarter.
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