SBI posts losses for 3rd quarter in a row
State Bank of India (SBI) shocked investors with a third straight quarter of losses as it provided for bond losses upfront and forecast another quarter of pain as it awaits the resolution of a troubled asset, sending the stock down 3.8%. But the bank promised to deliver full-year profits as it believes loan demand is set to accelerate in the coming quarters and default rates will slow, having almost fully provided for all cases referred to the bankruptcy court.
The country’s largest lender posted a June quarter loss of ₹4,876 crore against a profit of ₹2,006 crore a year earlier. Analysts had forecast a net profit of ₹238 crore, according to Bloomberg. The markto-market bond losses added up to ₹5,900 crore.
Loans grew 7% with retail lending, led by home and car loans, increasing 14%. Operating expenses jumped 20% to ₹16,505 crore, fuelled by a surge in staff pensions and goods and services tax (GST) payments. Operating profit was flat at ₹11,973 crore.