Mumbai, Nov 8 (PTI) State Bank of India (SBI) on Friday reported 23 per cent jump in consolidated net profit for September quarter at Rs 19,782 crore, helped by an increase in non-interest income and treasury profits.
On a standalone basis, the country's largest lender reported a net profit of Rs 18,331 crore as against Rs 14,330 crore in the year-ago period and Rs 17,035 crore in the preceding quarter.
Its core net interest income grew 5.37 per cent to Rs 41,620 crore despite a 15 per cent increase in advances, as a 0.15 per cent narrowing in the net interest margin to 3.14 per cent caused a pull.
Non-interest income grew 42 per cent to Rs 15,271 crore helped by gains on forex and treasury.
Newly appointed chairman C S Setty said the bank is maintaining the 14-16 per cent advances growth target for the fiscal, but lowering the deposit growth target to around 10 per cent as against 12-13 per cent earlier.
"The intensity of effort for deposit mobilization gives me confidence that (deposit growth) will definitely be in double digits if not 12-13 per cent," Setty told reporters in comments that come days after Bank of Baroda lowered its deposit growth target.
The bank's profit is the highest among any commercial entity, and Setty said it is aspiring for a profit of Rs 1 lakh crore in a fiscal but declined to give a timeline.
He said the first aspiration is to get the operating profit, which touched Rs 63,895 crore on a consolidated level in the first half of the fiscal, to Rs 1 lakh crore and then concentrate on touching the Rs 1 lakh crore in net profit, which will make it the first company ever to do so.
The bank expects that the RBI will cut the key rates not before February, Setty said, adding that 42 per cent of its book is not linked to the external benchmark which gives him the confidence of maintaining margins.
Setty said NIMs will be stable from here and also made it clear that deposit rates have peaked. The bank does not wish to attract deposits by way of higher rates but would rather focus on getting funds on the basis of services it offers, he said.
The chairman said it is launching dedicated offerings for women and senior citizens soon, and also looking for the recently introduced wealth management efforts under the 'premier' brand to aid the deposit accretion efforts.
Managing Director Vinay Tonse said the bank is targeting customers with total relationship value of Rs 30-50 lakh for the wealth management offerings, which is much lower than Rs 1 crore and above being targeted by peers. It has already put in place a team of 500 dedicated relationship managers for this purpose, he said.
The bank's credit-deposit ratio is a comfortable 67 per cent, and Setty added that additional efforts on deposit accretion are driven more by its focus to maintain and grow market share in deposits.
On the lending side, it said retail loan growth has been soft in the first half of the fiscal, but it is seeing signs of pick up with the festivities in it. The demand for unsecured loans was also low, Setty said, adding no stress is being witnessed in this segment for the bank.
Corporate loan growth came at 17 per cent and the bank is confident of maintaining the same for the fiscal, its managing director Ashwini Kumar Tewari said, adding that it has a pipeline or undisbursed limits of Rs 6 lakh crore on this.
Amid concerns on sluggish private capex, Tewari said SBI has sizeable proposals on capital investments for both greenfield and brownfield expansion from corporates.
Setty said the bank will not take a big bet on the aviation sector, where it has been lending based on the strength of the promoters rather than operational aspects.
The bank has a Rs 11,000 crore exposure to microlending companies and the same is going well from an overall perspective, Tewari said.
On the asset quality front, the fresh slippages reduced to Rs 3,831 crore as against Rs 3,867 crore in the year-ago period, and gross non-performing assets ratio improved to 2.13 per cent as on September 30, from 2.21 per cent in June.
Setty said the bank could recover over Rs 2,300 crore from written-off accounts earlier as against Rs 1,600 crore earlier, and exuded confidence of maintaining the same going ahead as well.
Its overall capital adequacy level stood at 13.76 per cent as of September 30, with the core tier-I buffer at 9.95 per cent. Setty said if one were to include the FY25 profits, it will be able to use Rs 10 lakh crore of advances.
Among the subsidiaries, the life insurance arm's net for the first half increased to Rs 1,049 crore from Rs 761 crore in the year-ago period, credit card arm's profit decreased to Rs 999 crore from Rs 1,196 crore for the same period.
Funds management PAT jumped to Rs 1,374 crore from Rs 940 crore and general insurance's post tax profit shot up to Rs 414 crore from Rs 60 crore.
The SBI scrip closed 1.86 per cent down at Rs 843.25 on the BSE, as against a 0.07 per cent correction on the benchmark.