Financial Daily from THE HINDU group of publications
Friday, Jul 29, 2005
Financial Daily from THE HINDU group of publications Friday, Jul 29, 2005 |
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Public Sector Banks Money & Banking - Financial Performance Corporate Results - Public Sector Banks SBI Q1 net up 15.5 pc at Rs 1,223 cr Our Bureau
Mumbai , July 28 HIGHER interest income and lower operating costs have enabled State Bank of India to report a 15.54 per cent increase in net profit in the first quarter of 2005-06, despite a substantial increase in provisions against bad loans and losses in securities trading. The bank has earned a net profit of Rs 1,222.83 crore for the quarter ended June 30, 2005 against Rs 1,058.40 crore in the year-ago period. Total income increased to 10,742.85 crore (Rs 9,205.29 crore). Net interest income rose by 19.88 per cent to Rs 3,541.34 crore (Rs 2,954.07 crore). Net interest margin (NIM) improved to 3.14 per cent from 2.99 per cent. "This is one of the best NIMs in the industry," said a senior SBI official. He attributed the increase in profit to business growth in the retail and SME sectors. The bank has also been able to contain costs, he said. Operating expenses fell by 1.28 per cent due to a 3.5 per cent decline in the payment of wages. This is because of the Rs 88-crore saving on account of the voluntary retirement scheme amortisation, he said. Wage cost may go up in the current quarter following the payment of arrears. Gross advances increased to Rs 2,20,523 crore (Rs 1,66,387 crore). Deposits have registered a 13.76 per cent growth at Rs 376,141 crore (Rs 330,648 crore). In Q1 2005-06 , retail advances had grown by Rs 2,771 crore against Rs 1,382 crore in the year-ago period. Housing loans increased by Rs 1,861 crore to Rs 26,849 crore. Home loans constitute 54.55 per cent of SBI's retail advances. The bank made a provision of Rs 1,308.33 crore (Rs 4.99 crore) to cover the depreciation in the value of investments and Rs 236 crore (Rs 210 crore) for bad loans. Net non-performing assets, however, have fallen to 2.44 per cent from 3.45 per cent. The bank's capital adequacy ratio stands at 11.63 per cent against 13.82 per cent in the first quarter of 2004.
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