State Bank of India (SBIN) Q4 02/03 earnings summary

Executive summary

• FY03 standalone net profit rose 27.7% to Rs.3,105 crore; operating profit increased 28.6% to Rs.7,775.40 crore.

• Earnings growth benefited from higher net interest and fee income, with investment-sale gains contributing Rs.1,342.96 crore more than in FY02.

• Deposits grew 9.4% to Rs.2,96,123 crore and advances 14.0% to Rs.1,37,758 crore at March 2003.

Financial highlights

• Total income was Rs.36,827 crore, up 8.4%; total expenditure was Rs.33,722 crore, up 6.9%.

• Net interest income rose 9.87% to Rs.9,977.56 crore; net interest margin increased to 2.95% from 2.91%.

• Non-interest income increased 37.5% to Rs.5,740.26 crore, led mainly by investment-sale gains and forex income.

• Investment-sale profit was Rs.1,694.60 crore versus Rs.351.64 crore in FY02; government-securities sale profit reached Rs.1,778 crore versus Rs.341 crore.

• Consolidated net profit attributable to the group was Rs.4,199.01 crore; consolidated EPS was Rs.79.78 versus Rs.63.72.

Outlook and guidance

• Targeted retail advances at 60% of National Banking Group advances within two years; 50% of total FY04 credit growth targeted from retail.

• Planned to computerize all branches by 2004, with partial rollout of core banking and trade-finance solutions in FY04.

• Targeted net NPA ratio below 2% by March 2005; Asset Reconstruction Company (India) Ltd. expected to begin operations in FY04.

• Proposed an 85% dividend for FY03, subject to RBI approval, up from 60% for FY02.