SBI Q1FY26 Results: Profit Rises 12.5% YoY to ₹1.92 Lakh Crore; Asset Quality Improves
- 11th August 2025
- 06:30:00 PM
- 3 min read
Mumbai, August 11 – State Bank of India (SBI) posted a 12.5% year-on-year rise in net profit to ₹1,91,604 crore for the June quarter, driven by higher fee income and lower operating costs, even as net interest margins remained under pressure. Core pre-provision operating profit stood at ₹2,42,200 crore, up 0.7% from a year earlier, supported by a 27.8% jump in fee income to ₹93,090 crore and tighter expense management.
Net interest income declined marginally by 0.1% YoY to ₹4,10,725 crore as NIM fell to 2.9% from 3.1% a year ago, with deposit costs rising due to a shift towards term deposits and slower repricing. The bank expects margin pressure to continue in Q2FY26 before improving in the second half of the year.
SBI Q1FY26 – Key Financial Highlights
| Metric (₹ crore) | Q1FY26 | Q1FY25 | YoY Change | Q4FY25 | QoQ Change |
| Net Interest Income (NII) | 4,10,725 | 4,11,255 | -0.10% | 4,27,746 | -4.00% |
| Net Profit | 1,91,604 | 1,70,352 | 12.50% | 1,86,426 | 2.80% |
| Core PPoP | 2,42,200 | 2,35,777 | 0.70% | 2,44,062 | -0.80% |
| GNPA Ratio | 1.83% | 2.21% | -38 bps | 1.82% | +1 bps |
| NNPA Ratio | 0.47% | 0.57% | -10 bps | 0.47% | 0 bps |
| Advances | 41,96,205 | 37,49,139 | 11.90% | 41,63,312 | 0.80% |
| Deposits | 54,73,254 | 49,01,726 | 11.70% | 53,82,189 | 1.70% |
| CASA Ratio | 37.80% | 39.10% | -130 bps | 38.4% | -60 bps |
| NIM | 2.90% | 3.10% | -20 bps | 3.09% | -19 bps |
Also read : SBI vs BOB Q1FY26 Results
Advances grew 11.9% YoY and 0.8% sequentially to ₹41.96 lakh crore, with SME and retail lending driving momentum. SME loans rose 4.4% QoQ and retail loans 2.2%, while the corporate loan book contracted 3% due to prepayments and competition from the commercial paper market. Management retained its full-year credit growth guidance at around 12%, with potential upside to 13% if macro conditions remain supportive. Demand from the power sector, commercial real estate, and premium housing projects is expected to fuel growth, along with a pick-up in personal and auto loans.
Asset quality improved further, with the gross NPA ratio at 1.83% compared to 2.21% a year earlier and the net NPA ratio steady at 0.47%. Gross slippages stood at ₹83,980 crore, but strong recoveries in July reduced net slippages to 49 bps. The bank does not expect significant stress in SME or unsecured portfolios and aims to keep the slippage ratio below 0.6% for FY26. Recoveries from written-off accounts are projected at ₹70,000–₹80,000 crore.
Deposits grew 11.7% YoY to ₹54.73 lakh crore, led by term deposits. The CASA ratio declined to 37.8% from 39.1% a year ago, reflecting the shift towards higher-yield term deposits. The cost of funds remained elevated but is expected to moderate in the coming quarters following rate adjustments. Return on assets stood at 1.2% and return on equity at 17.7%, while the cost-to-income ratio improved to 47.7% from 49.4% a year earlier.
The bank’s capital adequacy ratio was 14.6%, with Tier I capital at 12.5%. Management said the focus in the coming quarters will be on profitable loan growth, margin recovery, and maintaining asset quality at current levels. Domestic NIM is expected to follow a U-shaped trajectory, bottoming in Q2FY26 before improving in Q3FY26.
PL Capital View: At ₹804 per share, SBI trades at 1.5 times FY27 estimated core adjusted book value. Its subsidiaries, including SBI Life Insurance, SBI Cards, and SBI Mutual Fund, continue to add significant value, positioning the bank for sustained growth amid stable economic conditions and a healthy credit environment.
PL Capital
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