SBI Q3 Profit Beats Estimates on Strong Loan Growth

India’s largest lender, State Bank of India (SBI), reported a stronger-than-expected rise in third-quarter profit, driven by robust loan expansion and higher non-interest income. The state-backed bank posted a standalone net profit of 210.28 billion rupees for the quarter ended December 31, up from 168.91 billion rupees a year earlier and well above analysts’ estimate of 173.26 billion rupees. Net interest income rose 9% year-on-year to 451.9 billion rupees, while the net interest margin remained steady at 3.12%.

SBI’s loan book expanded 15.4%, supported by solid demand from small and medium enterprises as well as retail borrowers. Deposit growth stood at 9% during the quarter. The lender’s performance mirrors broader credit trends in India, where banks saw a revival in double-digit loan growth in the October–December period, aided by festive season spending and consumption-boosting tax measures. Other income, including treasury gains, surged 66% to 183.58 billion rupees, adding to overall profitability.

However, provisions for bad loans and other contingencies rose sharply to 45.07 billion rupees. Despite this, asset quality improved, with the gross non-performing asset ratio declining to 1.57% in December, down 50 basis points from a year earlier. Recent policy rate cuts by the Reserve Bank of India — totaling 125 basis points over the past year — are aimed at supporting growth, though such easing can temporarily pressure bank margins as lending rates adjust faster than deposit rates.

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