SBI Q3 net rises over 13 per cent to Rs3,806 crore
22 Jan 2011
State Bank of India (SBI), the country's largest lender, has reported a 13.45 per cent rise in its consolidated net profit for fiscal third quarter ended 31 December 2010, at Rs3,806.49 crore, against a consolidated net profit of Rs3,354.94 crore in the year-ago period.
SBI's total income increased 14.7 per cent to Rs36,966.87 crore in the October-December 2010 quarter against Rs32,231.45 crore in the same quarter of the previous financial year, SBI said in a filing with the Bombay Stock Exchange (BSE).
During the October-December 2010 quarter, SBI posted a net profit of Rs3,710.48 crore against Rs3,304.59 crore in the same quarter a year ago.
On a standalone basis, SBI's net profit grew 14 per cent to Rs2,828.06 crore in the third quarter against Rs2,479.05 crore in the year-ago period.
SBI on Friday said it has chalked out a plan to reach the RBI-mandated 70 per cent provision coverage ratio (PCR) three months ahead of the 30 September deadline.
The bank aims to increase provisioning cover by 250 basis points each quarter, so that it can reach the 70 per cent mark by the end of the first quarter of the next financial year.
At the end of the second quarter of this financial year, SBI's PCR was 62.78 per cent, including technical write-offs.
According to estimates, SBI will need to provide around 2,000 crore more, which means it will provide around 600 crore each quarter till it reaches the 70 per cent mark. "By increasing the loan loss cover by 2.5 percentage points every quarter, we aim to reach the 70 per cent PCR mark by the end of June. We have kept one more quarter in hand in case of any shortfall," said a senior SBI official.
In October 2009, the RBI asked banks to have 70 per cent PCR by September 2010. However, some banks, including SBI and ICICI Bank, requested RBI for more time. While ICICI Bank got three months extension, SBI was given one more year.
While SBI's asset quality is likely to remain stable in the third quarter, the bank is expected to make more provisions to reach the 70 per cent PCR mark.