India's largest lender State Bank of India reported an 8% year-on-year rise in net profit on lower provisions.
Net profit for the quarter rose to Rs 14,330 crore in the July-September quarter, compared with Rs 13,625 crore a year ago. Analysts polled by Bloomberg estimated a net profit of Rs 14,329 crore for the second quarter.
Core income, or net interest income, for the quarter rose 12% from a year ago to Rs 39,500 crore. Other income too rose by 21.6% to Rs 10,790 crore.
The bank's operating profit fell 8.07% year-on-year during the three-month period to Rs 19,417 crore. The net interest margin also slipped by 12 basis points to 3.43% in the reporting quarter.
Asset quality for the lender improved with gross non-performing asset ratio falling 21 basis points to 2.55% on a quarter-on-quarter basis. Net NPA ratio too fell to 0.64%, compared to 0.71% as of June 30.
The bank reported gross slippages in the September quarter at Rs 4,081 crore, out of which fresh slippages amounted to Rs 3,831 crore. The bank's slippages ratio increased by 13 bps year-on-year to 0.46% as of Sept. 30. The recoveries and upgrades stood at Rs 4,015 crore, down from Rs 5,207 crore a year ago. Loan write-offs by SBI stood at Rs 4,420 crore as of Sept. 30.
Provisions for the quarter fell 96% from a year ago to Rs 115.3 crore. The provision coverage ratio, or PCR, fell 248 basis points year on year to 75.45% as of Sept. 30. The bank provided Rs 33,794 crore for non-NPA provisions, which is not included in PCR.
The bank's gross advances grew 12.4% on year to Rs 34.11 lakh crore, driven by home loans, retail advances and SME loans. Total deposits of the public sector bank rose 12% year-on-year to Rs 46.89 lakh crore. Sequentially, CASA ratio of the bank fell by 100 bps to 41.88% as on Sept. 30.
The credit cost for the September quarter improved by 6 basis points year-on-year to 0.22%.
SBI's capital adequacy ratio rose by 77 basis points on year as on Sept. 30 to 14.28%.
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