SBI Q3 Results: Net Profit Meets Estimates, Asset Quality Improves

India's largest lender State Bank of India saw its net profit for the October-December quarter rise 84% year-on-year to Rs 16,891 crore. The profit rise was aided by higher core income during the quarter.

Analysts polled by NDTV Profit estimated a net profit of Rs 16,500 crore for the quarter.

Net interest income, or core income, for the bank was up 4% from a year ago and stood at Rs 41,445.5 crore. Other income, however, fell 3.65% to Rs 11,040.76 crore.

Provisions rose 32.4% from last year to Rs 911.06 crore. Slippage in the December quarter was recorded at Rs 3,823 crore, while the slippage ratio stood at 0.39%, down 19 bps year-on-year and down 12 bps sequentially.

The key Current Account Savings Account for India's biggest lender was recorded at 39.2%, against 40.03% in the previous quarter. Notably, the public lender's credit cost fell by 14 bps to 0.24%.

• Net profit: Rs 16,891 crore versus Rs 9,164 crore, up 84% YoY.

• Net interest income: Rs 41,445.5 crore versus Rs 39,816 crore, up 4% YoY.

• Gross NPA at 2.07% versus 2.13% (QoQ).

• Net NPA flat at 0.53% (QoQ).

State Bank of India's credit growth stood at 13.49% against the same period last year, while domestic advances rose 14.06%. Credit growth remained robust across all segments, with lending to small and medium enterprises up 18.7%. Lending to agriculture was up 15.31%, while credit to corporate and retail climbed 14.86% and 11.65%, respectively.

The third quarter results highlight "continuity and consistency", Chairman CS Setty said at the press conference. The impact of trade wars across all countries have yet not materialised, Setty said.

The CPI inflation has eased to a four-month low, and will continue to decline, he said. "SBI results demonstrate bank’s ability to deliver profitability at scale." The bank may not have 30-35% CAGR on unsecured personal loans, but will grow in double digits, Setty said.

The state lender aims to increase the share of the current account, while eyeing to consistently achieve return of equity of 15%, the Chairman said. Net interest margins are broadly holding up and the cost of deposits are higher because savings account deposits are moving to fixed deposits, he said.

After the results were declared, shares of SBI closed 1.51% lower at Rs 743.9 apiece on the NSE, compared to a 0.39% decline in the benchmark Sensex.