SBI triumphs with Q2FY24 results: Net profit soars to Rs 14,330 crore, exceeding expectations

Business Sunday 05/November/2023 06:38 AM
SBI triumphs with Q2FY24 results: Net profit soars to Rs 14,330 crore, exceeding expectations

Mumbai: The State Bank of India (SBI) has unveiled its Q2FY24 results, showcasing a significant boost in its financial performance. SBI reported a remarkable 8 per cent year-on-year (YoY) growth in its standalone net profit, reaching Rs 14,330 crore for the September quarter.

In addition to the robust profit figures, the bank's net interest income (NII) for the quarter ended September 2023 witnessed substantial growth, surging by 12.3 per cent YoY to reach Rs 39,500 crore.
These results have exceeded market estimates, signifying a strong performance in a challenging economic environment.

However, it's not just profit and NII that grabbed the spotlight. SBI's domestic net interest margin (NIM) for Quarter 2 Financial Year 2024 (Q2FY24) came in at 3.43 per cent, indicating a YoY decline of 12 basis points.

This points to the intricacies of navigating the complex financial landscape.

Amidst the financial fluctuations, SBI continued to demonstrate its commitment to asset quality improvement.

In Q2FY24, State Bank of India's Gross Non-Performing Assets (GNPA) showcased a significant improvement, decreasing by 97 basis points YoY to 2.55 per cent.

Similarly, the Net NPA improved, showing a decline of 16 basis points to stand at 0.64 per cent.

Analysing the provision for expected losses, the Provision Coverage Ratio (PCR) stood at 75.45 per cent for the quarter ending September 2023, which reflects a marginal reduction of 248 basis points YoY.

Despite this, the bank remains dedicated to containing slippages, as seen in a Slippage Ratio for Q2FY24 that increased by only 13 basis points YoY to 0.46 per cent.

SBI's credit cost, an essential metric for evaluating its lending operations, improved by 6 basis points YoY to 0.22 per cent during the period under review, indicating efficient risk management practices.

The bank's Capital Adequacy Ratio (CAR) at the end of Q2FY24 stood at 14.28 per cent, representing a significant YoY improvement of 77 basis points.

This robust capital position indicates SBI's readiness to seize opportunities for growth and navigate uncertainties in the financial sector.

Reflecting on the balance sheet, SBI showcased a robust performance in terms of credit growth. For the quarter ending September 2023, the credit growth of the State Bank of India surged by 12.39 per cent YoY, with domestic advances growing even more significantly at 13.21 per cent YoY.

This impressive growth was primarily driven by a strong uptick in SME Advances (22.75 per) and Retail Personal Advances (15.68 per cent).

The Foreign Offices' Advances of the bank also recorded notable growth, surging by 8.11 per cent YoY to cross Rs 5 lakh crores. This global presence contributes to SBI's continued expansion.

Moreover, SBI's Whole Bank Deposits exhibited substantial growth, recording a year-on-year increase of 11.91 per cent.

Notably, Current Account and Savings Account Deposits (CASA), a pivotal component of Whole Bank Deposits, showed growth at a slightly lower rate of 4.91 per cent YoY.

As of September 30, the CASA ratio, which reflects the proportion of Current Account and Savings Account Deposits to total deposits, stood at a healthy 41.88 per cent.

The latest quarterly results demonstrate the resilience and strategic prowess of the State Bank of India, highlighting its strong financial position and commitment to fostering economic growth.

As the banking sector continues to face dynamic challenges, SBI's performance stands as a testament to its adaptability and strength.