The logo of State Bank of India (SBI) is seen on the facade of its headquarters in Mumbai, India, April 12, 2023. REUTERS
Nov 4 (Reuters) – State Bank of India , the country’s largest lender by assets, reported a higher profit in second-quarter on Tuesday, aided by proceeds from the stake sale in Yes Bank.
The state-run bank’s net profit rose to 201.6 billion rupees ($2.29 billion) for the three months ended September 30, from 183.31 billion rupees a year earlier.
In September, the lender completed a 13.2% stake sale in Yes Bank to Sumitomo Mitsui Banking Corporation for 88.89 billion rupees.
On account of the transaction, SBI recorded a one-time profit of 45.93 billion rupees for the quarter, aiding its bottom line.
While analysts expected margin contraction and tepid loan growth to hurt overall earnings in the banking sector, Indian lenders have seen a gradual pickup in credit demand in the July-September period after a couple of quarters of slowdown. They are expected to see robust credit growth in the second half of the current fiscal year boosted by recent tax cuts.
SBI’s net interest income rose 3.3% year-on-year to 429.84 billion rupees during the quarter, beating analyst average estimate of 419.73 billion rupees, as per data compiled by LSEG.
Lenders, such as HDFC Bank and Axis Bank have posted strong credit growthin the quarter ended September.
SBI’s gross non-performing asset (NPA) ratio improved to 1.73%, compared with 1.83% in the previous quarter.
Reporting by Nishit Navin; Editing by Rashmi Aich
