NEW DELHI: June quarter earnings of State Bank of India (SBI), the country’s largest lender, had enough reasons to give investors a high even as the bruises of Covid second wave is reflected on its asset quality.On Monday, the bank reported a record quarterly net profit of Rs 6,504 crore in the April-June period, an increase of 55.2% over the year earlier driven by lower provisions for bad loans and rise in other income.
Net interest income, or core income, rose 3.7% year-on-year to Rs 27,638 crore. Other income grew 48% to Rs 11,803 crore in the three months to June thanks to the Rs 1,692 crore worth recovery from the Kingfisher Airlines account. Operating profit rose 5.06% to Rs 18,975 cr.
However, the bank did feel the impact of the pandemic that struck in April further impacting individuals’ ability to repay. Gross non-performing asset (NPA) ratio stood at 5.32% compared with 4.98% as of March. Net NPA ratio rose 27 basis points sequentially to 1.77%. The SME (small and medium enterprise) segment is the worst hit with gross NPAs jumping from 7.67% to 9.22% in the reported period despite the moratorium, additional funding under government guarantee and one-time loan restructuring.
The personal loan segment, which includes mortgages as well, saw bad loans increase from 0.80% in the March quarter to 1.28%. However, if one looks at the incremental slippages, the bank reported fresh slippages of Rs 15,666 crore during the quarter compared with Rs 21,934 crore in the preceding quarter. SME added Rs 6,416 crore worth of slippages, while retail loans added Rs 5,268 crore slippages, which came largely from the home loan portfolio.
“Around 50% of our home loan book is to non-salaried customers which belong to the SME segment. The slippages are largely because of the disruption in the SME segment,” said SBI chairman Dinesh Khara.
The home loan portfolio stood at Rs 5.05 lakh crore as on June 30 and saw a 59 basis point (bps) sequential rise in bad loans. The bank, however, was able to gain a 24 bps market share from competitors and saw an 11% year-on-year growth in mortgages.
PNB Housing Fin Q1 net profit slips 5% to Rs 243 cr
PNB Housing Finance on Wednesday reported an over 5% decline in its consolidated net profit to Rs 243.28 crore for the first quarter ended June 30. The company had posted a net profit of Rs 257.18 crore in the year-ago period. On a sequential basis, it was higher than Rs 127 crore in the March 2021 quarter. The total income of the company fell to Rs 1,692.88 crore in Q1FY22, as against Rs 1,872.33 crore in Q1FY21, PNB Housing Finance said in a regulatory filing. On a standalone basis, the net profit during the quarter stood at Rs 234.96 crore, compared to Rs 259.61 crore a year ago. The total income stood at Rs 1,676.45 crore in June 2021 quarter, lower than Rs 1,868.58 crore in the year-ago period.