SBI Q4 net up 41 pc to Rs 9,114 cr on higher NII growth, drop in bad loans
Mumbai: The country’s largest lender SBI on Friday reported a 41.28 per cent rise in standalone profit after tax at Rs 9,114 crore for the quarter ended March 2022, driven by healthy interest income and better asset quality.
Its standalone profit after tax (PAT) stood at Rs 6,451 crore in the fourth quarter of the previous fiscal.
For the full year ended March 31, 2022, PAT grew by 55.19 per cent to Rs 31,676 crore as against Rs 20,410 crore in FY21.
“The bank has been able to deliver reasonably good outcomes in business, profitability and asset quality parameters. We have also created sufficient contingency provisions against restructured books to insulate our balance sheet from any future shocks,” State Bank of India (SBI) Chairman Dinesh Khara told reporters.
“I am quite optimistic and confident of improving our performance going forward,” he added.
The net interest income (NII) increased by 15.26 per cent to Rs 31,198 crore in Q4 FY22 from Rs 27,067 crore in the year-ago period.
Domestic net interest margin (NIM) increased by 29 bps year-on-year at 3.40 per cent in Q4 FY22, from 3.11 per cent in the same quarter of the previous fiscal.
The asset quality of the bank saw improvement, with gross non-performing assets (GNPAs) declining to 3.97 per cent from 4.98 per cent. Net NPAs fell to 1.02 per cent from 1.50 per cent in the fourth quarter of FY21.
Slippage ratio for the fourth quarter stood at 0.43 per cent.
Khara said the bank has made adequate provisions for accounts where it is seeing any kind of stress and does not expect any surprises coming from NPAs.
“Of late, we have seen more responsible borrowings and that is why we are hopeful that we would not have much challenge as far as NPAs are concerned. We are seeing a situation where people have started repaying as per their original repayment schedule,” he noted.
Asked about the bank’s exposure to Future Group and Srei Group, Khara said both the accounts are being fully provided for.
Fresh slippages during the quarter were to the tune of Rs 2,845 crore. Recovery and upgradation stood at Rs 6,756 crore in Q4 FY22.
Total provisions dropped 20 per cent to Rs 10,603 crore as against Rs 13,249 crore. Loan loss provisions declined 67.10 per cent to Rs 3,262 crore from Rs 9,914 crore.
Provision Coverage Ratio (PCR) improved by 416 basis points (bps) year-on-year at 75.04 per cent.
Capital Adequacy Ratio (CAR) at the end of Q4 FY22 stood at 13.83 per cent.
Domestic advances grew 10.27 per cent y-o-y, primarily driven by growth in retail personal advances (15.11 per cent).
Foreign office advances rose by 15.42 per cent. The bank’s retail portfolio crossed Rs 10 lakh crore.
Home loans, which constitute close to 23 per cent of the bank’s domestic advances, grew by 11.49 per cent.
Its corporate loan book registered a growth of 6.35 per cent y-o-y during FY22.
Khara said the bank started seeing traction in the corporate loan book from Q3 FY22 onwards and expects much better capacity utilisation in terms of the working capital going ahead.
“If I look at the unutilised portion of the working capital and term loans, and also the proposals that are in the pipeline, we have a visibility of almost around Rs 4.6 lakh crore of loan proposals,” he said.
Total deposits grew at 10.06 per cent y-o-y. Savings bank deposits rose by 10.45 per cent, while term deposits grew by 11.54 per cent.
The bank’s scrip ended at Rs 445.05 apiece, down 3.76 per cent on BSE on Friday.
Speaking on transfer bad loans to the National Asset Reconstruction Company Ltd (NARCL), Managing Director J Swaminathan said the identification of stressed accounts and due diligence is almost done and he expects binding bids to come in in the next two weeks.
