MUMBAI: State Bank of India reported a net profit of Rs 18,643 crore for Jan-March quarter, down 9.9% from Rs. 20,698 crore a year ago, mainly due to a one-time provision for increased pension liabilities. The bank had implemented a uniform 50% hike in pensions and adjusted payouts for inflation through dearness relief neutralisation. As a result, total provisions rose 57% to Rs 12,643 crore, with Rs 7,100 crore allocated to pension adjustment.
The bank has also announced its plans to raise Rs 25,000 crore through issue of new shares – its largest capital raise so far and the first major capital raise in over a decade. The board has declared a dividend of Rs 15.9 per share.
Excluding the pension provision, the quarter showed stronger performance. Operating profit rose 8.8% to Rs 31,289 crore, supported by a 39.4% jump in non-interest income to Rs 24,210 crore. A key driver was treasury income, which nearly doubled to Rs 6,870 crore, even as net interest income grew just 2.7%. The bank also reported a marked improvement in asset quality with gross non-performing assets declining to 1.8% – below 2% for the first time, while net NPAs declined to under 0.5%.
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