State Bank of India Q1 net profit misses estimates, bad loans rise

 Reuters        Last Updated: August 11, 2017  | 18:43 IST
State Bank of India Q1 net profit misses estimates, bad loans rise

State Bank of India (SBI), the nation's biggest lender by assets, on Friday reported first-quarter profit that missed analysts' estimates, following a decline in net interest income and rise in bad loans.

The results are the first since SBI merged with five of its subsidiary banks and also took over a niche lender for women from April 1.

For the merged entity, net profit was Rs 2006 crore ($312.84 million) in the three months through June, from Rs 374 crore a year earlier. Pre-merger, the bank's year-earlier profit was Rs 2521 crore.

The result compared with the 3029 crore average analyst estimate, Thomson Reuters data showed.

Net interest income fell 3.5 percent to Rs 17606 crore.

SBI, which accounts for about a fifth of India's banking sector assets, said for the merged entity, gross bad loans as a percentage of total loans was 9.97 percent at the end of June from 9.11 percent three months earlier and 7.40 percent at the end of June last year.

Indian banks have been hit by higher provisions and regulatory scrutiny as bad loans reached a record $150 billion in December. Earlier this year, the government gave the central bank greater power to push defaulting borrowers into bankruptcy proceedings.

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