SBI Q2 Profit Rises 20% to Rs 25,361 Crore, NSE and Mutual Fund IPO Gains Drive Growth

State Bank of India (SBI) reported a 20 per cent year-on-year rise in consolidated net profit to Rs 25,361 crore for the July-September quarter of FY27, supported by substantial gains from the stake sales in its mutual fund arm and the National Stock Exchange (NSE).

On a standalone basis, the country's largest lender recorded a 14 per cent increase in net profit to Rs 23,038 crore. Its core net interest income (NII), which reflects the difference between interest earned on loans and interest paid on deposits, grew 14.69 per cent to Rs 49,143 crore, supported by strong credit growth.

SBI's gross advances expanded 17.84 per cent during the quarter, while its overall net interest margin (NIM) stood at 2.94 per cent. However, domestic NIM improved by 0.11 percentage points from the previous quarter to 3.11 per cent.

Chairman C S Setty said the bank expects to maintain its domestic NIM above 3 per cent going forward. SBI has retained its FY27 credit growth target at 14-15 per cent and deposit growth target at 10-11 per cent.

The bank's earnings also received a significant boost from investment gains. SBI booked Rs 7,288 crore from the sale of its stake in SBI Funds Management through its IPO and another Rs 2,800 crore from the NSE stake sale. The mutual fund arm's IPO also helped revalue SBI's investment.

Despite these gains, non-interest income declined nearly 5 per cent to Rs 19,066 crore, partly due to the impact of rising bond yields on treasury operations.

Asset quality continued to improve, with fresh loan slippages declining to Rs 5,227 crore and the gross non-performing assets (NPA) ratio falling to 1.39 per cent as of September 30.

SBI also reported a capital adequacy ratio of 16.09 per cent, compared with 15.67 per cent in the previous quarter. The bank said it would need to set aside Rs 19,500 crore for the transition to the expected credit loss-based provisioning system.

Meanwhile, its corporate loan pipeline stood at Rs 7.8 lakh crore, reflecting expectations of continued demand for business credit.