SBI results disappoint, NPAs at 10% of total loans

MUMBAI: Shares of SBI tanked more than 5% after the country's largest lender reported a spike in bad loans, which are now almost 10% of total advances. Chairman Arundhati Bhattacharya said that the rise in bad loans was a fallout of efforts by the bank to integrate operations of SBI's five erstwhile associate banks with itself following their merger in end-March 2017.

SBI's net profit at the end of the first quarter stood at Rs 2,006 crore compared to a combined (SBI and associates) net profit of Rs 374 for the first quarter of FY17. When compared with the Rs 2,521 crore stand-alone net profit (excluding associate banks) in the first quarter of FY17, SBI's Q1FY18 net profit is lower by 20%. The stand-alone profits for Q1FY17 were higher than the consolidated Q1FY17 profit because the associate banks had reported a combined loss of Rs 2,018 crore in the first quarter of FY17.

Shares of SBI closed at Rs 281, down over 5%, after the bank said that there was a gross addition of Rs 30,059 crore to its gross non-performing assets (NPAs), which now stand at Rs 1.88 lakh crore, or 9.97% of total loans.