India’s largest bank posts record quarterly profit as bad debt provisions decline
BENGALURU, Aug.4 (Reuters) – The State Bank of India (SBI.NS), the country’s largest lender in terms of assets, on Wednesday reported record quarterly profit that also exceeded analysts’ expectations, aided by a sharp drop in provisions for damaged assets.
Net profit rose 55% to 65.04 billion rupees ($ 876.79 million) for the three months ended June 30, from 41.89 billion rupees a year earlier, as provisions for bad debts increased. fell 46.6%, the lender said in a press release. deposit.
Analysts on average expected a profit of 61.09 billion rupees, according to data from Refinitiv IBES.
Slippages, or the new addition of bad debts, more than quadrupled to 156.66 billion rupees.
The SBI’s gross bad debt ratio, which had downplayed concerns about asset quality at the end of the March quarter, climbed to 5.32% from 4.98% a quarter earlier. Read more
The findings come as many Indian banks struggle to contain bad debt additions, especially in the retail portfolio, as the second wave of COVID-19 and resulting lockdowns hit economic activity, limiting the ability of borrowers to repay loans and affect collections.
SBI shares, which outperformed the Nifty Bank Index (.NSEBANK) with a jump of more than 60% to reach all-time highs this year, rose 3% after the results.
($ 1 = 74.1800 Indian rupees)
Reporting by Chris Thomas in Bangalore; Editing by Sriraj Kalluvila
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