Key Highlights
- SBI Net Profit Down 9.9% YoY in Q4 FY25
- Record ₹70,901 Cr Annual Profit Despite Quarterly Dip
- Provisions Soar to ₹12,643 Cr on Wage, NPA Buffers
- Net Interest Income Grows Marginally to ₹42,775 Cr
- NIM Declines 32 bps YoY to 3.15%
- Operating Costs and Wage Revisions Pressure Margins
- Board Recommends ₹15.90 Dividend Per Share
- Strong Credit Growth, Lower NPAs Boost Confidence
SBI Posts ₹18,643 Cr Profit in Q4 FY25 — 9.9% Lower YoY
The State Bank of India (SBI), India’s largest public-sector lender, reported a 9.9% year-on-year drop in net profit to ₹18,643 crore for the quarter ending March 31, 2025 (Q4 FY25), primarily due to a surge in provisioning expenses related to employee costs and potential NPAs. However, profits were up 10.4% sequentially from ₹16,891 crore in Q3 FY25.
FY25 Ends with Record ₹70,901 Cr Net Profit
Despite the Q4 dip, SBI delivered a record-breaking annual profit of ₹70,901 crore in FY25, representing a 16.08% growth over FY24. The board has proposed a ₹15.90 per share dividend, up from ₹13.70 last year, showcasing shareholder confidence.
Net Interest Income and Margins
SBI’s Net Interest Income (NII) grew 2.69% YoY to ₹42,775 crore in Q4. Sequentially, NII rose 3.21%, indicating steady core lending income. However, Net Interest Margin (NIM) from domestic operations fell 32 basis points to 3.15%, weighed down by rising funding costs and wage adjustments.
Provisions Skyrocket 57% YoY
Total provisions for Q4 FY25 stood at a substantial ₹12,643 crore, compared to ₹8,049 crore in the same quarter last year. The spike is attributed to wage settlements, credit risk buffers, and general provisioning amid macroeconomic uncertainties.
Cost Pressures Weigh on Operating Profit
Rising operational overheads, subdued treasury income, and employee-related costs impacted operating performance. The cost-to-income ratio improved to 51.64%, but still reflects strain on the bank’s profitability matrix.
Asset Quality Shows Improvement
Despite the provisioning spike, asset quality improved:
- Gross NPA Ratio: Dropped to 1.82%, down 42 bps YoY
- Net NPA Ratio: Improved to 0.47%, down 10 bps
- Provision Coverage Ratio (PCR): Healthy at 92.08%
Loan & Deposit Growth Strong
- Total Advances: ₹42 trillion, up 12.03% YoY
- Home Loans: Grew by 14.46% YoY
- Retail Personal Loans: Up 11.40%
- Corporate Loans: Grew 9%
- Deposits: Rose 9.48% YoY to ₹53.8 trillion
- CASA Ratio: Stands at 6.34%
Capital Adequacy & Fundraising Plans
SBI maintained a robust Capital Adequacy Ratio (CAR) at 14.25%, with CET-1 at 10.81%. The bank’s board is also reviewing options to raise equity capital in FY26 via FPOs, QIPs, Rights Issues, or ADRs, depending on market conditions.
What It Means for Investors
While the Q4 dip may cause short-term concern, strong fundamentals, improving asset quality, and solid yearly performance make SBI a continued favorite among institutional and retail investors. The dividend hike and fundraising plans signal strategic growth ahead.
📌 What’s Next
Post-results, the market will closely watch SBI’s roadmap for FY26, provisioning strategies, and guidance on interest margins and credit outlook. The equity-raising move could be a key trigger for the bank’s stock performance.
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