SBI net profit to cross Rs 10,000-cr mark in current fiscal

SBI net profit to cross Rs 10,000-cr mark in current fiscal

The bank had recorded a meagre 0.4 per cent rise in net profit at Rs 9,166.05 crore last fiscal.

"It (net profit) should cross Rs 10,000 crore this year," SBI Chairman O P Bhatt told PTI.
The country's largest bank has already reported an over 25 per cent growth in net profit at Rs 2,914.20 crore for the first quarter ended June 2010 despite an increase in its bad debts.

The rise in net profit was mainly due to a three-year high net interest income and a decline in the cost of deposits and savings.

Net interest income rose by 45.35 per cent during Q1, compared to the same quarter a year ago. Growth in net income was 4.30 per cent in June 2009.

Operating profit zoomed 66.97 per cent in the first quarter. It had declined 7.28 per cent last year.

However, fall in treasury income and rise in provisions among others pulled down SBI profit growth last year. The bank had recorded a meager 0.4 per cent rise in net profit at Rs 9,166.05 crore last fiscal. The total income rose to Rs 85,962.07 crore compared to Rs 76,479.2 crore in FY 2009.

SBI has already expressed hope that it is aiming at a profit growth of 20 per cent in the current fiscal.

Meanwhile, SBI raised its benchmark lending rate by 50 basis points and deposit rates by up to 150 basis points effective today.

The increase in the benchmark prime lending rate to 12.25 per cent will make existing home, auto and corporate loans from the country's biggest lender dearer while the hike in deposit rates will ensure better returns for deposit- holders.

However, for new borrowers, the base rate, which became effective from July 1 this year, stands at 7.5 per cent. The base rate is the minimum lending rate below which loans cannot be offered.

As far as the revision in fixed deposit rates is concerned, SBI increased the interest rate by 150 basis points (1.5 per cent) to 4 per cent for term deposits of 15-45 days' tenor. The deposit rate increase is the maximum in this slab.

For fixed deposits with a tenor between 181 days and less than one year, the new interest rate is 6 per cent against the existing 5.25 per cent, while 555-day fixed deposits attracts an interest rate of 7.25 per cent, an increase of 125 basis points.

The interest rate on term deposits of between 3 to 5 years went up by 75 basis points to 7.25 per cent, while interest on the 5-8 years' maturity slab has been increased by 25 bps to 7.50 per cent.

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