SBI net up 1% to £1.7 bn, higher than RIL’s for 2nd quarter in row

State Bank of India reported a 1% increase in its Q1FY25 net profit to £1.7 bn from £1.68 bn in the corresponding quarter last year. However, profits were almost flat due to a reduction in interest margins and a 70% jump in provisions for bad loans.
The net profit of the country’s largest bank is higher than that of Reliance Industries which totalled £1.51 bn. This marks the second consecutive quarter in which SBI has outperformed RIL, a company that has long held the title of the most profitable in the country.
“In the last four years, SBI has generated a total net profit of over £16 bn which is more than the net profit made in the previous 60 years,” said Dinesh Khara, chairman, SBI. Khara, whose term ends soon, added that he hoped to see SBI generate annual profits of £10 bn.
At the end of the first quarter, SBI’s deposits increased by 8.2% year-on-year to £490 bn. However, this was marginally lower than the £492 bn reported at the end of March 2024. The bank’s advances at the end of the quarter grew by 15.4% year-on-year to £380 bn, which is a 1.2% increase compared to March 2024.
“We raised deposits when other banks were not looking at deposits and we deployed the funds in investments. These investments are giving us headroom to grow our credit. On deposits, we are making an optimum choice not to raise funds at any cost and simultaneously take care of depositor interest. As a result, while our cost of deposits has gone up by 45 basis points, the impact on our NIM is much lower,” said Khara.