SBI GREW IN SIZE AND STATURE UNDER RAJNISH

Amidst the uncertainties and challenges the banking sector and Indian economy experienced, State Bank of India’s (SBI’S) performance under the leadership of Rajnish Kumar is noteworthy. Deposits and advances are up 26-30 per cent since September 2017. Net interest margins are 80 basis point higher than levels when Kumar joined.

Operating profit is down though, mainly due to the fluctuating other income that includes treasury income. Notably, since September 2017, gross net non-performing assets (NPAS) have fallen from

~1.86 trillion to ~1.3 trillion at the end of June 2020.

With SBI providing over ~1.56 trillion for bad loans over the past 11 quarters, net NPAS have shrunk to below ~43,000 crore, less than half the ~97,000 crore figure Kumar inherited. Thus, the net NPA ratio is now under 2x. Yet, profit before tax has averaged at over ~4,900 crore in each of the past five quarters, with provisioning coverage ratio at all-time high of 86.3 per cent. Most notably, during these three years, the value of

SBI'S investments and subsidiaries has more than doubled to ~1.52 trillion, which is a little lower than SBI'S market capitalisation of ~1.71 trillion.