Provisions and contingencies dipped 19.6 per cent on-year to Rs 10,051.96 crore in the reported quarter, while other income soared 48.5 per cent to Rs 11,802.7 crore.
While provisions in the quarter dipped year-on-year, the lender’s asset quality suffered likely due to the onset of the second wave of the Covid-19 pandemic. SBI’s gross non-performing assets ratio stood at 5.32 per cent as against 4.98 per cent in the previous quarter. Similarly, the lender’s net NPA ratio stood at 1.77 per cent as against 1.50 per cent in the previous quarter.
The country’s largest lender by assets saw its net interest income in the quarter rise 3.7 per cent year-on-year to Rs 26,642 crore. However, net interest margin shrank 9 basis points on-year to 3.24 per cent in the June quarter.
Non-interest earnings business had a strong quarter as revenues in the segment surged 24.3 per cent year-on-year to Rs 11,803 crore.
On the operating front, SBI reported a 5 per cent year-on-year rise in pre-provision operating profit to Rs 18,975 crore despite an increase in expenses as Covid-related cost benefits petered out during the quarter.
Credit growth in the domestic market was at 5.6 per cent year-on-year, likely reflecting muted demand due to Covid-19 second wave. The lender said that retail loans grew at a healthy pace of 16.5 per cent on-year followed by agriculture and small business loans.
Home loans, which now make up for 23 per cent of SBI’s advances, surged 11 per cent on-year, reflecting the rise in demand for housing in the country.
Credit cost for the lender fell sharply to 0.79 per cent in the June quarter from 1.56 per cent in the year-ago period. At the same time, the lender said that slippages during the quarter stood at Rs 15,666 crore.
Shares of SBI reacted positively to the earnings and were up 3.1 per cent at Rs 460.3 on the National Stock Exchange.
