The biggest public-sector lender in India, SBI, announced its second-quarter results on Friday afternoon, triggering a slide in the stock price despite trading in the green in the morning trade.
For the quarter, State Bank of India (SBI) net profit jumped 27.9 per cent year-on-year to Rs 18,311 crore, beating market estimates. SBI also recorded a credit growth of 14.93 per cent year-on-year. Consolidated net profit saw a yearly improvement of 23 per cent to reach Rs 19,782 crore.
Despite beating the market outlook, shares slipped post the earnings announcement by at least 2.3 per cent in afternoon trade. SBI shares had traded higher in morning trade on Friday ahead of the quarterly results, hitting a high of Rs 863.50.
ALSO READ | Jet Airways: From major Indian private air carrier to bankruptcy and liquidation
Investors were also looking at the asset quality, and the gross Non-Performing Assets (NPA) ratio at the quarter-end stood at 2.13 per cent. Compared to the same period last year, this was an improvement of 42 basis points. Provisions for bad assets almost doubled to Rs 3,631 crore.
For banks, a lower NPA is better. A higher NPA ratio means that the bank has too many non-functioning loans. SBI's net NPA for Q2 was 0.53 per cent compared to 0.57 per cent from the previous quarter.
On Thursday, the State Bank of India also announced the launch of an innovation hub in Singapore in partnership with the local collaborative innovation platform for financial institutions, APIX.
