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State Bank of India — Q1 FY25
SBI reported a modest 0.9% YoY PAT growth to INR 17,035 crore in Q1 FY25, with operating profit up 4.55% to INR 26,449 crore.
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SBI reported a modest 0.9% YoY PAT growth to INR 17,035 crore in Q1 FY25, with operating profit up 4.55% to INR 26,449 crore. Domestic advances grew 15.55% YoY, while deposits grew only 8.18%, widening the gap. Net interest income rose 5.71% YoY, but NIM compressed 11 bps due to deposit cost pressures. Asset quality improved with gross NPA at 2.21% (down 55 bps YoY), though slippages ticked up to INR 7,900 crore, partly seasonal. The cost-to-income ratio improved 95 bps to 49.42%. Management guided for NIM stability within ±10 bps and credit cost around 0.50%. Key risks include deposit growth lagging credit, potential ECL provision impact, and elevated slippages in unsecured retail. The bank's strong capital position (CET1 10.25%) and excess SLR of INR 3.7 trillion provide buffers.
SBI ने पहली तिमाही (अप्रैल-जून 2024) में अपना मुनाफा 0.9% बढ़ाकर 17,035 करोड़ रुपये किया। परिचालन मुनाफा 4.55% बढ़कर 26,449 करोड़ रुपये रहा। बैंक ने लोन 15.55% बढ़ाए, लेकिन जमा सिर्फ 8.18% बढ़ी, जिससे अंतर बढ़ा है। ब्याज आय 5.71% बढ़ी, लेकिन जमा पर ज्यादा ब्याज देने से मुनाफे का मार्जिन थोड़ा कम हुआ। खराब लोन (NPA) घटकर 2.21% रह गया, जो पिछले साल से 0.55% कम है। हालांकि, कुछ नए खराब लोन 7,900 करोड़ रुपये आए, जो मौसमी है। बैंक का खर्च कम हुआ और पूंजी मजबूत है। आगे मार्जिन स्थिर रहने और खराब लोन पर खर्च 0.50% रहने का अनुमान है। जमा से ज्यादा लोन बढ़ना और छोटे कर्जों में बढ़ोतरी जोखिम है, लेकिन बैंक के पास 3.7 लाख करोड़ रुपये का अतिरिक्त सुरक्षित निवेश है।
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Deposit growth lagging credit growth
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Domestic Advances Growth
15.55%
+15.55% YoY
Domestic advances grew 15.55% YoY, driven by retail, agri, and SME segments.
Gross NPA Ratio
2.21%
-55 bps YoY
Gross NPA ratio improved to 2.21%, the lowest in over a decade.
Cost-to-Income Ratio
49.42%
-95 bps YoY
Cost-to-income ratio improved 95 bps YoY to 49.42%, aided by lower operating expenses.
Slippage Ratio
0.84%
-10 bps YoY
Slippage ratio improved to 0.84%, though absolute slippages rose to INR 7,900 crore.
What Changed vs Last Quarter
NEW
NIM to remain stable within ±10 bps
Management expects net interest margin to stay near current levels, with variation not exceeding 10 bps.
NEW
CD ratio target of 70-72%
Credit-deposit ratio expected to be around 70%, potentially rising to 72%.
NEW
Capital raise of INR 25,000 crore approved
Board approved raising INR 10,000 crore Tier 1 and INR 15,000 crore Tier 2 capital.
UPDATED
Credit cost guidance of ~0.50%
Sustainable credit cost expected to be around 0.50% going forward.
DROPPED
Loan growth of 13%-15% in FY25
Management expects overall loan book to grow 13%-15% in FY25, with corporate segment growing around 16%.
DROPPED
Staff cost increase of ~INR 6,000 crore in FY25
Additional staff cost due to wage revision is estimated at ~INR 500 crore per month, totaling ~INR 6,000 crore annually.
DROPPED
NIM to be maintained around current levels
Management expects net interest margin to remain stable around 3.4%, with marginal 5-6 bps variation.
NEW RISK
Deposit growth lagging credit growth
Deposit growth of 8.18% YoY trails credit growth of 15.55%, potentially pressuring liquidity and NIM.
NEW RISK
Elevated slippages in unsecured retail
Slippages in personal loans rose due to delayed salary credits in some states; though partly reversed, trend bears watching.
NEW RISK
Potential ECL provision impact
RBI's expected credit loss norms remain a consultation paper; management deflected quantification, citing it's premature.
NEW RISK
Regulatory scrutiny on CD ratio
RBI flagged loan growth exceeding deposit growth; management expects self-regulation but impact on growth is uncertain.
RISK GONE
RBI provisioning norms on project loans
RBI's discussion paper on higher provisioning for project loans could increase credit costs, though management believes it can be absorbed.
RISK GONE
CASA growth slowdown
CASA ratio declined 280 bps due to shift to term deposits; current account growth was only 2% YoY, pressuring margins.
RISK GONE
Competitive intensity in corporate lending
Intense competition from private and public sector banks may pressure yields and loan growth in the corporate segment.
RISK GONE
Potential equity dilution if growth accelerates
Management left open the possibility of raising equity if loan growth exceeds 21%, which could dilute existing shareholders.
🤫 Topics management stopped discussing
Mentioned in Q1 FY24, Q2 FY24, Q3 FY24
Deposit repricing at higher rates has pressured NIM; further compression could occur if competition intensifies.
Mentioned in Q1 FY24, Q4 FY24
Management expects net interest margin to remain stable around 3.4%, with marginal 5-6 bps variation.
Mentioned in Q1 FY24, Q2 FY24
If wage settlement exceeds the assumed 14%, additional monthly cost of ~INR 100 crore per 1% increase could pressure operating expenses.
Fast read
Guidance and risk preview
Management expects net interest margin to stay near current levels, with variation not exceeding 10 bps.
Deposit growth of 8.18% YoY trails credit growth of 15.55%, potentially pressuring liquidity and NIM.
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