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SBI net up 36 % at Rs. 9,121 cr

O. P. Bhatt

KOLKATA: State Bank of India has closed the fiscal 2008-09 with a net profit of Rs. 9,121 crore, which was 35.5 per cent higher than 2007-08. The performance during the last quarter ended March 2009 has been even better with a 45.62-per cent growth in net profit at Rs. 2,742 crore, bank Chairman O. P. Bhatt said here on Saturday.

SBI witnessed a total business growth of Rs. 3,30,899 crore including international business of Rs. 39,384 crore during the year.

Mr. Bhatt attributed the performance to good treasury business, increase in fee income and higher interest income on advances. “There has been a robust growth in income with growth in volume,” Mr. Bhatt said at a press meet here.A dividend of Rs. 29 a share has been proposed for the year against Rs. 21.50 in the previous year.

The bank chief said the worst was over for the economy and there should be a 6.5-7 per cent growth this year. Among the positive indicators, he cited increased cement production, revision in steel prices, and a pick-up in the automobile industry, housing, telecom and the banking sector.

He said the bank would recruit around 12,000 people this year. It hired 30,127 heads in 2008-09, which included a spill over from the earlier year. About 1,000 more branches including seven in Singapore were proposed during this year.

To a question as to why the net profit growth was lower this year compared to the 48-per cent growth in 2007-08, Mr. Bhatt said an overhang of deposits was one of the main reasons behind this. He said the net profit in 2008-09 would have been higher but for the Rs. 960-crore increase in pension provision. The liability had increased due to the fall in interest rates. The bank said it had kept the NPAs (non-performing assets) under control. While international NPAs had increased due to economic slowdown, domestic NPAs had increased by Rs. 1,774 crore with Rs. 1,651 crore being on account of Ratnagiri Power alone. Mr. Bhatt said the bank was ready for an entry into the general insurance business anytime this year and was awaiting the final approval from the Insurance Regulatory and Development Authority.

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