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Mumbai, June 1
State Bank of India is comfortably placed in terms of growth capital even as it expects further improvement in its financial performance in FY2023, according to its latest annual report.
The capital ratios of the bank improved during the last financial year (FY22) on the back of better planning, internal accruals and efficient risk management of the banking book, per the report.
Capital Adequacy Ratio (CAR) as at the end of March 2022 stood at 13.83 per cent, an improvement of 9 basis points over March 2021 level of 13.74 per cent. The Tier II capital base also improved to 2.41 per cent in March 2022 from 2.30 per cent in the previous year.
Economic activity picks up
The pace of economic activity has picked up and the momentum is expected to continue, said Dinesh Kumar Khara, Chairman.
He emphasised that despite the challenges posed by the operating environment, SBI today has better loss absorbing capability.
Khara said the bank’s risk management practices have delivered better results especially in containing the slippages.
In business operations, SBI will leverage advanced analytics for deeper insights on internal data and its best possible usage, Khara said.
Mutually beneficial partnerships with fintechs and NBFCs will be explored further to increase penetration and reach of the bank, he added.
“Opportunities for lending in promising sectors such as sectors identified under PLI (Production Linked Incentive) scheme and renewables as well as electric mobility will be explored to diversify the portfolio.
“...I am more than hopeful that the performance achieved in FY2022 will show further improvement in FY2023,” Khara said.
Digital banking
The report underscored that if the rising adoption of online and mobile banking in millennials is any indication, it is likely that the brick-and-mortar banking will have less relevance to the younger generation.
“The cashless economy is driving digital transformation faster than ever, with more banking organisations adopting digital banking.
“In our desire to future-proof businesses, we have adopted fintech as an opportunity to automate decision-making and improve efficiency.
“With our size, scale, and growth within the banking industry, we believe that we are in a much better position than most to survive and thrive in the digital age,” the report said.
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