SBI expects 10% credit growth in FY19, hopes to bounce back into profits

State Bank of India on Friday said it has 'set its house in order' and the credit growth is expected to see 10 per cent growth by the end of the current fiscal.

SBI Chairman Rajnish Kumar also said the bank was in the process of recruiting 8,000 people this year and hopes to also bounce back into profits from the current quarter as the major chunk of provisioning for bad loans was done in the first quarter.

He hoped that the headcount would be 2,60,000 by the end of this fiscal, maintaining the same level as FY18.

"Lending is mostly on consumer loans like car loans, home loans, personal loans. SME is showing a good pick up.

 

Corporate loans (are also improving) also because now we have put our house in order...so we are looking at some good lending opportunities and I think this year the corporate lending will be revived. We said 10 per cent growth in advances," he said at a press conference here.

The country's largest lender suffered a hefty loss of Rs 48.76 billion for the June quarter due to higher bad loans.

The total provisions more than doubled to Rs 192.28 billion for the first quarter of this fiscal, from Rs 89.29 billion in Q1 of FY 18.

On a consolidated basis, the bank posted a net loss of Rs 42.3 billion as against a profit of Rs 30.32 billion earlier.

Gross advances crossed the Rs 20 trillion mark and grew at 4.91 per cent to Rs 20483.87 billion by March 2018 from the previous year's level of Rs 1955.07 billion.

"A lot of provisioning was done in March quarter as well as in June quarter. The intent is to take the blow upfront and then from September onwards, start returning to normal.

In this year the bank will be in profits.It means whatever loss we shown in June ( April-June quarter), we will not only recover it, but also show profit in this year. Hopefully from September itself bank should show profit," he said.

He said the bank made a provisioning of Rs 700 billion in FY 18 against Rs 55,000 in FY17.

To a query on the interest rate scenario, he said they are stabilising and would not foresee any major changes.

SBI today made some donations under CSR activity to Greater Hyderabad Municipal Corporation, Government hospital and also for tribal welfare.