SBI Q2 Results: Net Profit Rises 14.3% to ₹23,038 Crore

State Bank of India reported a 14.3% rise in standalone net profit to ₹23,038 crore for the July–September quarter, according to its SBI Q2 results announced on 3 November.

Net interest income, the gap between what the lender earns on loans and pays on deposits, grew 14.7% year on year to ₹49,143 crore. An exceptional gain of ₹7,288 crore, which Business Standard linked to the sale of a stake in SBI Funds Management, also supported the bottom line.

Core profitability was softer. Operating profit slipped about 1.4% to roughly ₹26,900 crore from ₹27,311 crore a year earlier, according to IIFL. Non-interest income fell nearly 5% to ₹19,066 crore, mainly because of lower treasury income, Business Standard reported.

SBI Q2 results show a cleaner loan book

Asset quality continued to improve. Gross non-performing assets (NPAs) fell to 1.39% of loans from 1.73% a year earlier, while net NPAs eased to 0.36% from 0.42%. In absolute terms, gross bad loans stood at ₹72,529 crore.

Fresh slippages, or loans newly turning bad, came in at ₹5,227 crore during the quarter, compared with ₹4,754 crore a year earlier. Credit cost fell to 0.22% from 0.39%, and the provision coverage ratio stood at 74.43%.

Lending stayed strong. Total advances rose 17.84% to ₹52.08 lakh crore, led by agriculture loans, which grew 22.64%, and SME loans, which grew 21.97%. Retail personal loans rose 14.54% and corporate loans 16.12%.

Deposits increased 12.27% to ₹62.78 lakh crore, and the current and savings account (CASA) ratio stood at 38.32%. Domestic net interest margin improved by 11 basis points from the previous quarter to 3.11%.

The bank’s capital position also strengthened. Its capital adequacy ratio rose to 16.09% from 14.62% a year earlier, with the common equity tier-1 ratio at 13.34%. Return on equity for the first half stood at 18.68%, and return on assets at 1.14%.

Why State Bank of India profit matters for investors

SBI is India’s largest lender, and its total business stood at about ₹115 lakh crore at the end of September. Its quarterly numbers are widely read as a gauge of credit demand and stress across the banking system.

This quarter offered a mixed picture. Loan growth and asset quality held up well, but the decline in operating profit and weaker treasury income show that the headline growth leaned on the one-off gain.

The SBI Q2 results also showed a domestic credit-deposit ratio of about 73%, compared with 74.2% in the previous quarter. Domestic CASA deposits grew 8.13% to ₹22.96 lakh crore, while domestic term deposits rose 14.26% to ₹36.97 lakh crore.

Investors appeared to focus on the weaker core profit. SBI shares were trading 1.34% lower at ₹973.75 on the NSE at 2:48 pm on 3 November, according to IIFL.

The results arrive as interest-rate pressure builds. Chairman C S Setty said productive sectors such as corporates and MSMEs “will not really be impacted by the rate hike”, according to ANI, though he expected some moderation in discretionary consumption credit. Markets have been pricing in further tightening, as Business ERA reported in its analysis of RBI rate hike bets.

What comes next for SBI credit growth

SBI is guiding for full-year credit growth of 14–15% and deposit growth of 10–11%, Setty told reporters. He said excess statutory liquidity (SLR) holdings of ₹3.5–4 lakh crore give the bank enough room to support lending.

Setty also said RBI relaxations have helped the bank undertake acquisition financing, with SBI Capital Markets handling the advisory work while SBI provides the funding. On foreign portfolio outflows, he said the government “will look at all the options, including relooking at LTCG”.

Also Read: Federal Bank Q2 Profit Jumps 45% to Record ₹1,386 Crore

For investors, the next test is whether margins hold if rates rise further. Other lenders have also reported their numbers, with Canara Bank’s Q2 profit hitting a record as treasury gains faded. SBI’s quarterly disclosures are available on its investor relations page.