State Bank of India (SBI) has reported a 35.5% year-on-year fall in standalone net profit to Rs 9,163.96 crore for the quarter ended December due to a pension liability of Rs 7,100 crore.

In the year-ago quarter, India’s largest bank had reported a net profit of Rs 14,205.34 crore.

Total income during the fiscal third quarter ended December rose to Rs 118,192 crore versus Rs 98,083 crore in the same quarter of last year. 

Net interest income (NII), the difference between interest earned and interest expended, rose 4.5% to Rs 39,815.73 crore from Rs 38,068.8 crore.

Net interest margin of the lender stood at 3.22% in the December quarter.

“We absorbed additional liability to the tune of Rs 7,100 crore on account of anomaly in pension which used to persist since 2002 onwards. There was a set of employees in the bank who were entitled to a pension of 40% and a set of employees who were entitled to a pension of 50%,” SBI chairman Dinesh Khara said. 

“The matter was pending before a court of law. A settlement is almost in the offing and we have got approvals from the government as well as the RBI but are still awaiting the formal notification,” Khara added.

The banking elephant decided to provide for additional 5,400 crore on account of this increase in pension for all employees. There was also another obligation on dearness relief neutralisation for the pre-2002 retirees which was to the tune of Rs 1,700 crore.

The state-run lender’s gross non-performing assets (NPA) ratio improved to 2.42% (Rs 86,748 crore) as of 31 December versus 3.14% (Rs 98,346 crore) a year ago. 

Net NPA declined by 13 basis points year-on-year to 0.64%.

The provision coverage ratio (PCR) reached 74.17%, and when including additional unsecured credit amount (AUCA), it stood at 91.49%. 

Total non-NPA provisions, not included in PCR, amounted to Rs 33,472 crore, constituting approximately 149% of net NPAs at the end of Q3FY24.

Total deposits rose 13% to Rs 47.62 lakh crore in the December quarter.

CASA (current account savings account) deposits stood at Rs 18.81 lakh crore compared to Rs 18 lakh crore a year ago. The share of low-cost CASA deposits fell to 41.18% from 44.48% a year ago and 41.88% in the prior quarter.

Total advances grew 14.38% to Rs 35.84 lakh crore. Retail personal advances rose 15% to Rs 12.96 lakh crore.

The home loan book grew 13.16% to Rs 6.93 lakh crore.

The lender’s corporate loans crossed Rs 10 lakh crore. 

“We have seen better utilisation as well as disbursements when it comes to the corporate loan book. We have got a pipeline of Rs 4.6 trillion divided between private and public sector, with the private sector would have a share of 75% after accounting for the one-time exceptional item,” Khara said.