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SBI posts 75 per cent rise in net profit

SBI posts a 75 per cent increase in net profit at around Rs 14.93 billion for the quarter ended March 31.
IANS | By HT Correspondent, Kolkata
UPDATED ON MAY 12, 2007 09:40 PM IST

The State Bank of India (SBI), India's biggest public sector bank, on Saturday posted a 75 per cent increase in net profit at around Rs 14.93 billion for the quarter ended March 31, compared to Rs 8.53 billion for the same period in 2006.

The total income rose 29.05 per cent to Rs 144.35 billion for the quarter, from Rs 111.86 billion for the corresponding period a year ago, SBI chairman and managing director O P Bhatt informed.

"The rise in the profits was led by the growth in the mid corporate segment and the bank is focussing on the growth in the segment," Bhatt said.

The central board of the bank has declared a dividend of Rs 14 per share for the year ended March 31, 2007.

For the year ended March 31, the bank recorded a net profit of Rs 45.41 billion against Rs 44.06 billion for the period in the previous year, representing a marginal 3.1 per cent growth.

The growth was marginal because of the presence of some one-time gains in last year's profits, Bhatt said.

However, the SBI is planning to raise Rs 150 billion capital within the current fiscal to maintain the current rate of growth.

The funds will be raised through a mix of debt and equity, Bhatt said.

SBI is in discussions with 6-7 investment bankers to decide the right mix and timing of raising the funds.

SBI has also created a new business group to evaluate emerging business opportunities. It has decided to enter into business areas of private equity, infrastructure fund and venture capital.

SBI would form a private equity corpus of $1 billion (Rs 42 billion) to be invested into sectors like infrastructure, Bhatt said.

SBI's total income grew to Rs 45,260.28 crore (nearly Rs 452 billion) from Rs 43,414.77 crore (nearly Rs 434 billion) in the last fiscal.

SBI's balance sheet size crossed Rs 5,000 billion with deposits and advances crossing Rs 4,000 billion and Rs 3,000 billion respectively.

The gross NPA ratio of SBI declined from 3.61 per cent to 2.92 per cent. Correspondingly, the net NPA (non-performing assets) ratio declined from 1.88 per cent to 1.56 per cent.

The SBI is also planning to reach 1,00,000 unbanked villages within the next 24 months apart from entering into new business areas of private equity and general insurance among others.

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