Financial Daily from THE HINDU group of publications
Saturday, May 21, 2005
Financial Daily from THE HINDU group of publications Saturday, May 21, 2005 |
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Financial Performance Money & Banking - Financial Performance Corporate Results - Public Sector Banks SBI net jumps 17 pc; to pay Rs 12.5 dividend Our Bureau
Mr A.K. Purwar, Chairman, State Bank of India (right) and Mr K Ashok Kini, Managing Director, National Banking Group, at a press conference in Kolkata on Friday. — Parth Sanyal
Kolkata , May 20 RIDING high on the 16.94 per cent jump in net profit at Rs 4,304.52 crore in 2004-05 from Rs 3,681 crore in 2003-04, the board of directors of State Bank of India, at a meeting here on Friday, recommended 125 per cent dividend (Rs 12.5 per share) which includes a special dividend of 25 per cent (Rs 2.5 per share). "The special dividend has been proposed to commemorate the commencement of the 200th year of the SBI Group," said Mr A.K. Purwar, SBI Chairman, while briefing newspersons about the performance in 2004-05. In 2003-04, SBI had declared 110 per cent dividend including a special dividend of 10 per cent. The operating profit during the year under review amounted to Rs 10,990.36 crore (Rs 9,553.46 crore), recording a growth of 15.04 per cent. However, if the profit on sale of investment is excluded, the operating profit for the year would amount to Rs 9,215.06 crore (Rs 6,480 crore) thus posting 42.21 per cent growth. The profit on sale of investment thus was lower at Rs 1,775.30 crore (Rs 3,073.46 crore). The growth in profit thus is attributed to 24.66 per cent increase in net interest income to Rs 13,944.62 crore (Rs 11,186.32 crore) and the containment of operating expenses at a moderate 8.97 per cent (16.4 per cent). Advances grew to Rs 2,09,742 crore (Rs 1,65,278 crore), registering a growth of 26.9 per cent while the average yield on advances declined to 7.68 per cent (8.17 per cent) due to drop in interest rates. Deposits grew to 3,56,643 crore (Rs 3,17,762 crore), or a growth of 12.24 per cent while the cost of deposits (including IMDs) declined to 5.11 per cent (6.02 per cent). During the year under review, SBI's retail advances constituted 24.95 per cent (22.24 per cent) of its gross domestic advances and housing loan constituted 53.79 per cent of the bank's retail advances. SBI, as the Chairman indicated, hoped to post 23 per cent growth in advances and 16 per cent in deposits in 2005-06.
To tap overseas markets to bolster Tier II capital STATE Bank of India will raise up to Rs 4,000 crore in subordinated bonds to bolster its Tier II capital, Mr A.K. Purwar, Chairman, said here today. The bank, which may mobilise part of the capital requirement from overseas markets, is currently working out the details of the exercise. The latter is expected to be announced shortly. "Yes, we will need fresh capital to support our aggressive growth plans. Our business is growing steadily on many fronts. An overseas issue will provide us with greater visibility," he told newspersons here on Friday. The bank is expected to mobilise between Rs 3,000 crore and Rs 4,000 crore, it is pointed out. The SBI chief did not wish to comment on the nature of the instrument that may be used to tap overseas markets. Meanwhile, the bank is waiting for RBI guidelines on preference share issues. However, this will not affect its stand on a fresh capital infusion, Mr Purwar said.
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