On the back on higher provisioning for bad loans and investment depreciation, State
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Provisions for non-performing assets (NPA) increased by 75 per cent to Rs 2,782 crore compared to Rs 1,733 crore in the same period previous year. Total income for the quarter increased by 25 per cent to Rs 27,732 crore (Rs 22,142 crore). Net NPAs of the bank has come down to 1.61 per cent in April-June 2011-12 compared to 1.70 per cent in the previous year.
Net interest margin (NIM), which is key driver of profitability of banks, improved to 3.62 per cent in April-June quarter 2011-12 compared to 3.18 in the corresponding period in the previous year. SBI expects to maintain the NIM at 3.5 per cent level for rest of the financial year.
Talking about fresh slippages coming from across sectors such as iron and steel, mining, infrastructure, textile, gems and jewellery, Choudhuri said that it is indicative of overall stress in the economy. Bank is also looking at additional capital from the government to strengthen its capital adequacy ratio. “The government is committed to a well capitalised SBI. It will put in substantial money for rights issue. We expect the government to infuse Rs 5,000-9,000 crore worth of capital into SBI,” Choudhuri said.
The bank’s market share in advances has increased, while its market share in deposits has decreased on quarter-on-quarter basis. Current account savings account (CASA) ratio of the of the bank improved to 47.89 per cent compared to 47.51 per cent in corresponding period in the previous year.
Total deposits went by 16.5 per cent to Rs 9,50,072 crore. Advances increased by 18.7 per cent to Rs 7.88,153 crore.
SBI is expecting deposit growth of 20-21 per cent and credit growth of 16-18 per cent in 2011-12. The bank expects operating profit of Rs 7,000 crore and net profit of Rs 2,500 crore in In July-September quarter of 2011-12.
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