State Bank of India (SBI) today said it is hopeful of meeting the overall loan growth of 16-18% this fiscal as it expects retail lending to compensate for slowdown in corporate loans.
"We will meet the loan growth of 16-18% this fiscal, though I am not sure about corporate loan target due to the poor investment climate and the resultant slowdown in corporate loan demand.
"But I hope that retail loan book, especially auto and retail, will make up for the corporate slowdown," SBI Chairman Pratip Chaudhuri told reporters at the bank's headquarters here while announcing Q1 numbers.
He said SBI sees the deposit growth rising to 17-19% during the fiscal.
Earlier in the day, the nation's largest lender reported a massive 137% rise in net profit at Rs 3,752 crore even as it posted a spike in bad loans and restructured assets. The bank had a net profit of Rs 1,583 crore in the April-June quarter last fiscal.
The bank's net non-performing assets (NPAs) rose to 2.22% of total loan book as against 1.61% a year ago, reflecting the impact of slowing economy. Total income rose 16.89% to Rs 32,415 crore from Rs 27,732 crore a year ago.
Investors reacted adversely to the numbers and battered the SBI counter, pulling down the scrip to Rs 1,887.95, or 4.26%, on the BSE, which ended flat.
Before the numbers were announced, the stock rose to Rs 1,994.95 from yesterday's close of Rs 1,971.95 and hit a low of Rs 1,877.55.
In value terms, net NPAs rose to Rs 20,324 crore (2.22% of loans) during the June quarter from Rs 12,435 crore (1.61%). Similarly, gross NPAs rose to Rs 47,156 crore (4.99%) at the end of the first quarter as against Rs 27,768 crore (3.52%) a year ago.
On bad assets, Chaudhuri said he expects gross NPA to come down to 4.75 per cent from current 4.99%. "I see considerable reduction in NPAs in Q3. Our target is to get the net NPA down to 2%."