SBI reports 14.28 per cent rise in net profit for Q2FY27
State Bank of India saw improved asset quality and margins despite challenges in acquiring low-cost deposits, according to Mint.
State Bank of India (SBI) reported a 14.28 per cent year-on-year rise in net profit for the September quarter (Q2FY27). The bank's operating profit increased 7.28 per cent to ₹ 34,226 crore, which included an exceptional gain of approximately ₹ 7,288 crore from a stake sale in SBI Funds Management.
According to Mint, the bank's domestic net interest margin (NIM) improved 11 basis points sequentially to 3.11 per cent. This cleared the bank's commitment to keep NIM above 3 per cent. Core net interest income (NII) rose to ₹ 49,143 crore, a 15 per cent year-on-year increase that Jefferies India described as top-tier among large-cap banks.
Asset quality improved as gross non-performing assets (NPA) declined to 1.39 per cent of advances from 1.73 per cent a year earlier. Net NPA improved to 0.36 per cent, while credit costs fell to 22 basis points from 39 basis points year-on-year. For the first half of the financial year (H1FY27), loans grew 17.8 per cent year-on-year, driven by agriculture, SME, and corporate portfolios.
The bank retained its credit growth target of 14-15 per cent, a domestic NIM above 3 per cent, a return on assets (RoA) of 1 per cent, and a return on equity (RoE) above 15 per cent. Citi Research noted that SBI's whole bank loan growth in Q2FY27 was 18.2 per cent year-on-year, while the firm expects SBI to clock loan growth of 16 per cent plus for FY27.
JM Financial Institutional Securities said SBI's core fundamentals remain stable and support an RoA of around 1 per cent on average over FY27–29E. The analyst noted that treasury volatility and the Supreme Court's ruling on Yes Bank AT1 bonds remain key variables to monitor, noting SBI holds a 10.8 per cent stake in the lender.