SBI Q3FY23 profits up 69% at Rs14,205 crore on NII surge

State Bank of India (SBI) saw net profits rise for Q3FY23 by 68.5% at Rs14,205 crore on a standalone basis. This also represents the highest profit that SBI has reported in any quarter. Sequential net profits were up 7%. SBI also reported a 36.2% rise in the operating profits for the quarter (before provisions) at Rs25,219 crore for Q3FY23.

The SBI profit number was nearly 8% better than the Bloomberg consensus estimates. This growth in profits was largely driven by better spreads as evidenced by the improvement in NII and NIMs. For Q3FY23, the net interest income (NII) of SBI increased by 24% to Rs 38,069 crore. At the same time, the Net Interest Margins (NIM) expanded by 29 bps to 3.69% YoY. 

Total advances for the quarter were up 17.6% YoY to Rs31.33 trillion with domestic advances growing by 16.91%. SBI exposure to the Adani group was confirmed as less than 0.9% of the total advances book. Also, SBI clarified as part of the announcement that it had no Adani shares as collateral. Retail loans were the big driver of growth in advances at 18.10%, followed by corporate loans at 18.08%. Deposit growth was 9.5% yoy at Rs42.13 trillion.

For the quarter that ended December 2022, the gross non-performing assets (NPA) ratio fell 136 bps yoy to 3.14%. Net NPAs fell from 1.34% to 0.77% yoy. There was also an 18% fall in absolute Gross NPAs at Rs98,347 crore. For the quarter, SBI reported Slippage Ratio at 0.41%, while credit cost improved by 28 bps to 0.21%, giving a unique spread advantage. As of December 2022, the Capital Adequacy Ratio (CAR) stood at 13.27% for SBI.