NEW DELHI (India CSR): In a significant financial improvement, the State Bank of India (SBI) has reported a robust enhancement in its asset quality for the financial year 2024. The gross non-performing assets (NPA) of the bank have decreased to 2.24%, marking an improvement of 54 basis points (bps) year-over-year (YoY). Similarly, the net NPA also saw a positive shift, reducing by 10 bps to 0.57%. Furthermore, the credit cost has decreased by 3 bps, settling at 0.29%.
Economic Recovery Fuels Asset Quality Enhancement
The consistent improvement in asset quality can be attributed to the broad-based recovery in economic growth, which has supported the bank’s rigorous risk containment measures. The overall Gross NPA decreased to Rs. 84,276 crore as of March 2024 from Rs. 90,928 crore in March 2023. This improvement was witnessed across most segments, with a slight increase only in the personal segment.
Focused Reduction in Agricultural NPAs
A notable achievement for SBI this year has been the significant reduction in stress within the agricultural portfolio. For the first time, the bank’s agricultural gross NPAs fell to single-digit percentages. The bank’s Priority Sector Lending (PSL) to the agriculture segment and its sub-segments, including small and marginal farmers, weaker sections, and non-corporate farmers, has seen a substantial increase during the year.
Stable Asset Quality Across the Board
The asset quality improvement wasn’t restricted to SBI alone but was mirrored across all major sectors in All Scheduled Commercial Banks (ASCBs). The overall gross NPA ratio of ASCBs declined to 3.0% in December 2023, down from 4.5% in December 2022. Additionally, the Capital to Risk-weighted Assets Ratio (CRAR) of Scheduled Commercial Banks stood strong at 15.9% in December 2023, well above the regulatory requirements.
Sector-Specific Improvements in NPAs
SBI’s focused and proactive monitoring efforts have also led to significant improvements in specific loan categories:
- Home Loans: Net NPA in home loans was restricted to 0.76% as of 31st March 2024.
- Auto Loans: Auto loan NPAs decreased to 0.38% as of March 2024, down from 0.43% in March 2023.
These improvements mark a year of strategic successes for SBI, positioning it well for sustained growth and stability in the coming financial periods.
Here’s a condensed table highlighting the key facts from the State Bank of India’s asset quality report for FY2024:
| Gross NPA (%) | 2.24% | 2.78% | -54 bps |
| Net NPA (%) | 0.57% | 0.67% | -10 bps |
| Credit Cost (%) | 0.29% | 0.32% | -3 bps |
| Gross NPA (in Cr.) | Rs. 84,276 | Rs. 90,928 | Decreased |
| Overall Gross NPA Ratio (ASCBs) | 3.0% | 4.5% | Improved |
| CRAR (SCBs) | 15.9% | Above regulatory requirement | Stable |
| Home Loan Net NPA | 0.76% | — | — |
| Auto Loan NPA | 0.38% | 0.43% | Improved |
(India CSR)
