SBI Posts Record ₹21,028 Crore Q3 Profit with Stable Margins, Lower NPAs

India’s largest public sector lender, State Bank of India , reported a record standalone net profit of ₹21,028 crore for the third quarter (Q3) of the 2025–26 financial year , marking a significant 24% year-on-year increase and the highest quarterly profit in its history. The bank’s consolidated net profit also rose 13.06% year-on-year to ₹21,317 crore , underscoring strong operational performance across its business segments.

The bank’s strong earnings performance was driven primarily by healthy expansion in its core banking operations. Net Interest Income (NII) , a key indicator of profitability, grew by approximately 9% to ₹45,190 crore , supported by robust 15.14% growth in total loan advances , particularly in retail and small-medium enterprise (SME) segments, where credit demand remained strong. However, the Net Interest Margin (NIM) , which reflects the spread between interest earned and paid, remained largely stable at around 3.12% , indicating resilience in funding costs even as competitive and macroeconomic pressures persist.

Non-interest income also contributed meaningfully to the bank’s results, with fee and other income rising by over 15% to ₹8,404 crore . Deposit growth of around 9% further strengthened SBI’s liability base, enhancing stability and supporting future credit expansion. Meanwhile, operating expenses increased to ₹1,08,052 crore, reflecting ongoing investments in business operations and digital infrastructure.

Asset quality metrics continued to improve, reinforcing investor confidence. The Gross Non-Performing Asset (GNPA) ratio declined to 1.57% at the end of December from 1.73% in the previous quarter, indicating better risk management and improved credit discipline. Fresh slippages — new loans turning non-performing totalled ₹4,458 crore for the quarter, while provisioning for bad loans increased to ₹4,507 crore, significantly higher than the prior year, reflecting prudent financial planning.

In a post-results media briefing, SBI Chairman C.S. Setty noted that a special dividend of ₹2,200 crore from SBI Mutual Fund contributed to the profit growth, along with fee income gains and recoveries from previously written-off accounts. He also emphasized that recent international trade agreements and favourable government budget measures are likely to support broader credit demand in the economy, prompting the bank to revise its loan growth outlook to 13–15% for the full fiscal year .

SBI’s performance not only highlights its strong fundamentals but also reflects broader macroeconomic trends in India’s banking sector. Several lenders reported improved loan growth in the December quarter, suggesting a recovery in credit demand across industries after earlier slowdowns. This trend is significant because sustainable credit expansion is a key driver of economic activity, particularly in retail, SME, and infrastructure segments.

Overall, these results signal that SBI remains a critical barometer of India’s banking health, with its earnings, asset quality, and strategic positioning continuing to attract investor attention. With a strong capital adequacy ratio and improving asset quality, the bank is well placed to navigate evolving market conditions while supporting growth across the financial sector.