Sunday, May 10, 2009

Worst is over for Indian economy: SBI chief

The worst is over for the Indian economy and credit has again started flowing into key sectors, O.P. Bhatt, chairman of the country's largest lender State Bank of India (SBI), said here Saturday.

"The worst is over for the economy. Auto and housing loans have started picking up already," Bhatt told reporters after releasing the bank's financial results.

SBI, which accounts for about 25 percent of all loans and deposits in the country, has posted a net profit of Rs.9,121 crore for 2008-09 as against Rs.6,729 crore the year before, a rise of 35.5 percent.

"Net profit for the fourth quarter (January-March) of 2008-09 increased 45.62 percent to Rs.2,742 crore from Rs.1,883 crore in the corresponding quarter of 2007-08," Bhatt said.

On the overseas operations of the bank, he said SBI would concentrate on "consolidating the existing business network". The bank is present in 33 countries.

It has plans to increase its Singapore operations from the present five branches to 12 this year and to 20 next fiscal.

Asked about its plans of entering the general insurance business, Bhatt said: "We hope to start it anytime within this calendar year or latest by this fiscal end. We are yet to receive some final approvals."

The net non-performing assets (NPAs) ratio of SBI for 2008-09 stood at 1.76 percent, compared to 1.78 percent in 2007-08. The total amount restructured during the year was Rs.8,310 crore.

The capital adequacy ratio of the bank is above 14 percent.

SBI's total income for the fiscal rose 33 percent to Rs.76,479.2 crore from the previous year's Rs.57,645.2 crore.

Consolidated net profit was at Rs.10,955.2 crore, a 22 percent increase from Rs.8,960.6 crore in 2007-08.

The bank declared a 290 percent dividend at Rs.29 per share for fiscal 2008-09 that ended March 31.

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