SBI reports first profit growth in six quarters

MUMBAI Fri Aug 8, 2014 1:33pm IST

People walk in front of a signboard displayed at the head office of State Bank of India (SBI) in Mumbai February 14, 2014. REUTERS/Mansi Thapliyal/Files

People walk in front of a signboard displayed at the head office of State Bank of India (SBI) in Mumbai February 14, 2014.

Credit: Reuters/Mansi Thapliyal/Files

Related Topics

Stocks

   

MUMBAI (Reuters) - State Bank of India, the nation's top lender by assets, reported its first profit increase in six quarters on Friday on higher interest income, and said that bad loans were largely stable.

SBI, which accounts for about quarter of loans and deposits in India, said standalone net profit rose 3.3 percent year-on-year to 33.49 billion rupees ($545.22 million) in its fiscal first quarter to June 30, in line with analysts' estimate of 33.35 billion rupees.

Interest earned for the quarter rose 15 percent from a year earlier to 364.87 billion rupees.

Net non-performing loans as a percentage of total assets were 2.66 percent in June quarter from 2.57 percent in the previous three months, but gross non-performing loans were 4.9 percent compared with 4.95 percent in March quarter, the bank said.

Slower credit growth and a rise in bad loans have dragged the bank's profits lower for every quarter since the three-months ended December 2012.

A surge in bad loans has been one of the biggest challenges for the lenders, and state-run banks have seen bad loans piling up faster than their private sector peers.

SBI, which is nearly 59 percent owned by the Indian government, this year pledged to increase scrutiny of bad loans by doing regular reviews and using technology.

Indian lenders are hoping to see loan growth led by a revival in economic growth and project approvals after a new government took power this year. The economy grew less than 5 percent in the past two fiscal years, slowing loan growth and increasing borrower defaults.

Shares in SBI, valued at nearly $30 billion, were down about 1 percent by 0741 GMT in a Mumbai market that fell 1.3 percent. The stock has risen more than a third this year, outperforming the broader Nifty.

($1 = 61.4250 rupees)

(Reporting by Devidutta Tripathy; Editing by Miral Fahmy)

FILED UNDER:
Photo

After wave of QE, onus shifts to leaders to boost economy

DAVOS, Switzerland - Central banks have done their best to rescue the world economy by printing money and politicians must now act fast to enact structural reforms and pro-investment policies to boost growth, central bankers said on Saturday.

Barack Obama in India

Reuters Showcase

Coal Mining

Coal Mining

India to open coal to commercial mining firms soon, minister says  Full Article 

RBI Loan Rules

RBI Loan Rules

RBI relaxes overseas loan recast rules   Full Article 

E-commerce Firms

E-commerce Firms

Amazon, e-commerce rivals fuel commercial property boom in India  Full Article 

Growth Forecasts

Growth Forecasts

Indian economic growth forecasts pegged back, despite rate cuts: Reuters Poll.  Full Article 

Uber is Back

Uber is Back

Uber back in Delhi; govt says must await approval.  Full Article 

Markets at Record

Markets at Record

Sensex rises to record after ECB stimulus programme.  Full Article 

Pharma Sector

Pharma Sector

Ipca Labs hit by FDA ban on plant for standard violations.  Full Article | Related Story 

Forex Reserves

Forex Reserves

India FX reserves at record high as RBI fortifies defences  Full Article 

QE for Euro Zone

QE for Euro Zone

ECB launches 1 trillion euro rescue plan to revive euro economy.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage