Lower base helps SBI Q3 profit zoom 84 pc to Rs 16,891 cr; NIMs narrow

Mumbai, PTI: SBI on Thursday posted an 84 per cent jump in its December quarter net profit to Rs 16,891 crore, helped by a lower base in the year-ago period. The country's largest lender's standalone net profit in the year-ago period was at Rs 9,164 crore, restricted by a Rs 7,100-crore one-time provision towards pension liabilities. It had reported a net profit of Rs 18,331 crore in the preceding September quarter.

The core net interest income grew 4 per cent yearon- year to Rs 41,446 crore, despite a 14 per cent growth in advances but was impacted because of a 0.19 per cent narrowing in the net interest margin at 3.15 per cent. The bank's chairman C S Setty attributed the NIM impact to a shift in customer preferences, wherein money is getting parked in the high-yielding fixed deposits rather than the lowcost current and savings accounts. He said the cost of deposits has stabilised or peaked, and added that the NIM number will not fall below the 3 per cent mark.

He said increasing the share of CASA, which fell to 39.2 per cent during the quarter, seems difficult but contested against the low levels in the number being called as the new normal. "There is a shift in the saving behaviour which is irreversible in my view. There will be some movement from investments to savings, but broadly I think the culture of investments and looking towards generating some good returns on our savings is here to stay. "Also, the element of government managing its own cash flows is impacting the current account movement,'' he said.