State Bank of India (SBI) logo.
Credit: Reuters Photo
Mumbai: State Bank of India, the country's largest lender, reported an 8 per cent increase in net profit for the July-September quarter on Saturday, helped by healthy core lending income and robust loan growth.
The state-run lender's net profit rose to Rs 14,330 crore in its fiscal second quarter, from Rs 13,265 crore a year ago.
That was slightly higher than analysts' estimate of Rs 14,183 crore, according to LSEG data.
Net interest income - the difference between a bank's interest earned and paid - rose 12.3 per cent to Rs 39,500 crore from Rs 35,183 crore a year ago.
Net interest margin - a key gauge of lenders' profitability - shrank to 3.43 per cent, compared with 3.55 per cent a year ago, and 3.47 per cent in the prior quarter.
SBI's loans grew by 12.4 per cent year-on-year, while deposits grew 11.9 per cent.
Indian banks have consistently clocked double-digit loan growth over the past few months due to rising demand for credit, aided by increased consumer spending.
The ongoing festive season is expected to further boost customer spending, helping sustain the demand for retail loans.
SBI's gross non-performing assets (NPA) ratio was at 2.55 per cent as of end-September, compared with 2.76 per cent at the end of June.
Its net NPA ratio stood at 0.64 per cent at the end of the quarter, compared with 0.71 per cent at the end of the prior quarter.