SBI Q1 net profit jumps 81% YoY to Rs 4,189cr, moratorium declines to 9.5%


State Bank of India has posted 36.8 cent rise in profit before tax (PBT) at Rs 5,559.7 crores for the Q1 ended June 2020 (Q1FY21) on robust growth in net interest income.

SBI mentioned standalone net profit of Rs 4,189.34 crore for June quarter (Q1) of Financial Year (FY21) on Friday, supported through a one-time gain from stake sale in SBI Life for Rs 1,539.73 crore. This was 81.18 % higher than the Rs 2,312.2 crore net profit reported in the June quarter of Financial Year 20. On a quarterly basis, the net profit grew 17 % from Rs 3,580.8 crore stated in March quarter of FY20.

“Exceptional items for Q1 ended June 30, 2020 represent profit of Rs 1,539.73 crore on sale of sure element of investment in bank’s subsidiary SBI Life insurance Company Limited,” stated the bank in a statement.

On a consolidated basis, the net profit came in at Rs 4,776.5 crores, up 61.88 % Year over Year, from Rs 2,950.5 crores reported in first quarter of FY20.

The numbers beat Street estimates by a massive margin. Centrum Broking, for instance, saw the net profit at Rs 3,796.9 crores, while Emkay Global Financial Services pegged it at Rs 3,155.6 crores. Those at HDFC Securities, meanwhile, estimated the net profit at Rs 3,330 crores.

The bank’s operating profit increased by 36.35 % on a yearly basis to Rs. 18,061 crores in first quarter of FY21 from Rs 13,246 crores in Q1FY20.

Besides, the public sector bank’s net interest income (NII) – the difference between interest earned and expended – came in at Rs 26,641.6 crores, clocking a 16.1 % growth on a yearly basis from Rs 22,938.8 crores. The same was Rs 22,766.9 crores in Q4FY20. Domestic Net Interest Margin (NIM) improved to 3.24 % in Q1FY21, registering an increase of 23 bps Year over Year.

Provisions and slippages

The bank created total provisions worth Rs 12,501.30 crores during the Q1 under review, of which provisions for NPA stood at Rs 9,420.46 crores. Total provision at the end of Q1 of Financial Year 20 was Rs9,182.94 crores. Sequentially, the total provision declined 28.4 % from Rs 18,495.08 crores at the end of Q4FY20.

“During Q1 of Financial Year (FY) 2020- 21, the bank has made an additional provision of Rs 1,836 crores on account of Covid-19 related accounts. The provision of Rs 3,008 crores is held by the bank on Covid-19 related accounts as on June 30, 2020,” the bank said in a statement.

Provision Coverage Ratio as on June 30, 2020 was 86.32 %.

It similarly said, for the accounts covered under the provisions of insolvency and Bankruptcy Code (lBC), the Bank is keeping complete provision of Rs 5,835.29 crores (95.67 % of whole outstanding) as on June 30, 2020.

As regards slippages, the bank reported fresh slippages at Rs 3,637 crores, down from Rs 8,101 crores reported in Q4 of Financial Year 20.

Asset quality and moratorium

The bank said its loans under moratorium was 9.5 % at the end of June, 2020 quarter compared with 23 % at the end of March quarter of Financial Year 20.

The asset quality improved on a sequential basis. The gross non-performing assets (GNPA) were Rs 1.29 lakh crores, down from Rs 1.49 lakh crores reported in Q4FY20. In percentage terms, GNPA ratio improved by 71 bps Quarter on Quarter (QoQ) to 5.44 % from 6.15% in Q4FY20.

Net NPA (NNPA), on the other hand, were Rs 42,703 crores, down from Rs 51,871.3 crores in Q4FY20. The ratio was 1.86 %, down 37 bps Quarter on Quarter.

Loan and Deposits

The bank said its total deposits grew at 15.96 % Year over Year during the quarter under review, out of which Current Account Deposit grew by 12.98 % Year over Year, while Saving Bank Deposits grew by 17.29 % Year over Year. That apart, Home loan, which constitutes 22 % of the bank’s domestic advances, grew by 10.72 % Year over Year.

Credit Growth, meanwhile, stood at 6.58 % Year over Year, mainly driven by Retail (Personal) Advances (12.85 % Year over Year) and Foreign Office Advances (11.19 % Year over Year).

The stock closed 2.6 % higher at Rs 191.45 apiece on the BSE on Friday, as against 129 points, or 0.34 %, decline in the benchmark S&P BSE Sensex. The stock had touched an intra-day high of Rs 195, up 4.5 %, on the BSE soon after the result announcement.


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