SBI Q1 profit rises marginally to Rs 17,035 crore, bad loan provisions surge 70%

SBI Q1 earnings: State Bank of India (SBI), the country's largest lender, reported net profit of Rs 17,035 crore for the first quarter of the current financial year, marking a marginal increase of 0.89 per cent from Rs 16,884 crore in the same period last year. The slight rise in profit was primarily due to a sharp rise in provisions for bad loans, which surged 70 per cent annually to Rs 4,518 crore from Rs 2,651.85 crore.

The bank's net interest income (NII)—the difference between interest earned on loans and interest paid on deposits—rose 5.70 per cent to Rs 41,125.45 crore compared to Rs 38,904.95 crore in the previous year. However, SBI's net interest margin (NIM) contracted by 11 basis points to 3.22 per cent.

SBI's asset quality showed a slight improvement, with its gross non-performing assets (NPAs) as a percentage of total advances declining to 2.21 per cent at the end of the June quarter, compared to 2.24 per cent in the previous quarter and 2.76 per cent in the same quarter last year. In absolute terms, gross NPAs stood at Rs 84,226 crore. Net NPAs remained unchanged sequentially at 0.57 per cent.

The bank saw robust credit growth of 15.39 per cent, with advances surpassing Rs 38 lakh crore. The retail personal loan book grew by 3.60 per cent to Rs 13,68,045 crore, the agricultural loan portfolio increased by 17.06 per cent, the SME loan portfolio advanced by 19.87 per cent, and the corporate loan portfolio gained 15.92 per cent. Within the retail loan portfolio, home loans rose by 13.34 per cent, auto loans advanced by 16.63 per cent, Xpress Credit portfolio increased by 11.20 per cent and personal gold loans surged by 20.52 per cent.

SBI shares rose 12 per cent in the first quarter, outperforming the Sensex, which gained 7.3 per cent. However, ahead of the earnings announcement on Friday, SBI shares ended 1.72 per cent lower at Rs 847.90.