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BENGALURU, Oct 25 (Reuters) — State Bank of India (SBI) reported a three-fold jump in quarterly profit on Friday, buoyed by a 34.84 billion rupee ($491.15 million) gain from selling a portion of its life insurance unit, while asset quality also improved.
Net profit rose to 30.12 billion rupees in the three months ended Sept. 30, from 9.45 billion rupees a year earlier, the country’s largest lender by asset said in an exchange filing here Analysts expected a profit of 21.28 billion rupees, according to Refinitiv data.
Shares of the lender were up over 6% after the results.
Mumbai-based SBI’s performance is a bright spot in India’s banking industry, where weak loan growth due to a slowdown in the economy has compounded the sector’s near $150 billion-bad loan problem.
SBI’s net interest income climbed 17.7% to 246 billion rupees, while provisions for bad loans ticked up 8.4%. Net interest margin, a key indicator of a bank’s profitability, rose to 3.22%, up 42 basis points from a year ago.
Private sector banks Axis Bank Ltd and Kotak Mahindra Bank Ltd warned earlier this week of stress in their corporate books, with Kotak cutting its expectation for full-year loan growth.
Asset quality improved at SBI, with gross bad loans as a percentage of total loans easing to 7.19% by Sept-end, compared with 7.53% in the previous quarter and 9.95% in the same period last year. (Reporting by Chris Thomas in Bengaluru; Editing by Rashmi Aich)