SBI profit drops 13.6 percent in April-June quarter

The country's largest lender State Bank of India (SBI) Monday said its net profit dropped by 13.6 percent to Rs.3,241.08 crore (Rs.32.41 billion) for the quarter ended June 30 due to higher operating expenses and sluggish growth in interest income.

The bank has posted a net profit of Rs.3,241.08 crore for April-June quarter of the current financial year as compared to Rs.3,751.56 crore profit recorded during the same period last fiscal, posting a decline of 13.6 percent.

The company's total income, however, increased to Rs.36,192.62 crore for the quarter under review as compared to Rs.32,415.49 crore registered in the same quarter of 2012-13, SBI said in a statement.

The results disappointed the markets as SBI's share price slumped 2.68 percent to Rs.1,617 at the Bombay Stock Exchange. The share price hit a low of Rs.1,575 in the intra-day.

The lender's gross non-performing assets (NPAs) rose to 5.56 percent as on June 30, 2013, sharply higher from 4.99 percent recorded a year ago.

The economic slowdown has hit the company's asset quality. This has resulted in higher provisioning and low profit.