SBI profit falls 32 per cent in Jan-March, shares sink 4 per cent | india | Hindustan Times
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SBI profit falls 32 per cent in Jan-March, shares sink 4 per cent

The country’s largest bank, State Bank of India today reported a 31.9 per cent decline in its net profit for the quarter ended March 2010 at Rs 1,867 crore. The public sector lender had logged a net profit of Rs 2,742 crore in same quarter in the previous year.

india Updated: May 14, 2010 21:51 IST
HT Correspondent

The country’s largest bank, State Bank of India on Friday reported a 31.9 per cent decline in its net profit for the quarter ended March 2010 at Rs 1,867 crore. The public sector lender had logged a net profit of Rs 2,742 crore in same quarter in the previous year.

A sharp rise in provision for non-performing assets (NPAs) and operating expenses adversely impacted bank’s profitability. Its provisions for NPAs increased by 69 per cent to Rs 2,187 crore in quarter ended March 2010 in comparison to Rs 1,296 crore in the corresponding quarter last year.

SBI shares fell by 4 per cent on BSE after the results were announced.

“Higher provisioning for bad loans has been a major negative in the result for SBI,” said Alex Mathew, head of research at Geojit BNP Paribas Financial Services. “However, I expect this to come down in the financial year 2011.”

Operating expenses, which includes employee cost, were up by 41 per cent in the quarter under consideration. In a statement, the bank management has said “the Bank invested heavily in laying the foundation for future growth."

SBI spent Rs 347 crore on opening 1,049 new branches and installing 7,788 new automated teller machines (ATMs) during the year.

The total income for the quarter rose 1.8 per cent to Rs 22,474.12 crore. Income from interest was Rs 17,965.59 crore.

The bank declared a 300 per cent dividend at Rs 30 per share of Rs 10 face value.