SBI returns to profit after 9 months of heavy losses
After three quarters of continuous losses, a massive onetime gain and better asset quality helped the SBI on Monday report a consolidated net profit of Rs 576 crore for the September quarter, down 69 percent yoy
Mumbai: After three quarters of continuous losses, a massive one-time gain and better asset quality helped the SBI on Monday report a consolidated net profit of Rs 576 crore for the September quarter, down 69 per cent y-o-y.
The country's largest lender had posted a Rs 4,875.85 crore net loss in the previous quarter. At the standalone level, net income fell 40 per cent to Rs 944.9 crore from Rs 1,581.55 crore on the back of better asset quality. A higher tax outgo of Rs 868 crore also led to a lower bottomline. The numbers would have been bad, had it not been for the one-time income of Rs 5,436 crore on part stake sale in SBI Life during the quarter.
For the lender, this comes as a big breather having been in the red for the past three quarters. In the June quarter, the bank made a loss of Rs 4,876 crore and also in the March 2018 quarter when it had reported its biggest-ever net loss of Rs 7,718 crore.
Investors lapped up the numbers as they were expecting heavy losses this time around as well. The management guided towards better days ahead as it expects credit cost or provisioning to continue to improve as the quality of its assets gets better. The bank is also hopeful of clocking better credit sales and further improving the margin.
State Bank of India (SBI) Chairman Rajnish Kumar told reporters in a concall that the bank does not have an issue with its exposure to the troubled IL&FS group, which is only a little over Rs 4,250 crore to the group's a dozen or so special purpose vehicles, of which only one account is an NPA and has accordingly made a provision of Rs 56 crore.