SBI reports Rs 4,876 crore loss in first quarter; NPAs see sequential decline

Representational image | Reuters

The country's largest lender State Bank of India reported its third straight quarterly loss in the April-June quarter, as provisions continued to remain high. A sequential improvement in bad loan ration did drive shares up initially, however, the stock finally closed down 3.8 per cent at Rs 304.45 on the BSE.

In the first quarter, SBI reported a standalone net loss of Rs 4,876 crore, versus a net profit of Rs 2,006 crore in the year ago quarter and a record loss of Rs 7,718 crore in January-March. The first quarter loss was much higher than the analysts expectation of a loss of Rs 171 crore, according to a Reuters poll.

Net interest income in the quarter rose 24 per cent year-on-year to Rs 21,798 crore, the lender said.

“Bank's net loss is largely attributable to lower trading income and significant MTM (mark-to-market) losses due to hardening of bond yields, higher provision on account of wage revision and enhancement in gratuity ceiling,” the lender said.

In the last quarter, SBI's provisions and contingencies more than doubled to Rs 19,228 crore from Rs 8,929 crore a year ago, although they were lower than the Rs 28,096 crore reported in the Jan-March quarter.

Indian banks have been struggling with a sharp rise in non-performing assets over the last few years. In the quarter ended June 30, SBI's gross non-performing assets showed a sequential decline, although they were still higher year-on-year. Its gross NPAs were at 10.69 per cent in the first quarter, versus 10.91 per cent in April-June and 9.97 per cent in the year ago quarter.

Net NPAs, on the other hand, stood at 5.29 per cent in April-June, versus 5.73 per cent in the previous quarter and 5.97 per cent a year ago.

SBI's domestic CASA deposits in the quarter rose 7 per cent year-on-year to Rs 11,96,195 crore and domestic advances were up 7 per cent to Rs 17,23,443 crore.