State Bank of India (SBI) will revise its slippage numbers downwards by R1,389 crore for the quarter ended September 30, an SBI official said. The gross slippage numbers will now stand at around R7,100 crore compared with the earlier reported figure of R8,500 crore. There will, however, be no changes to the net slippages or gross/net NPA numbers.
SBI's share price rose 1.59% to R2,190.65 at the end of trade on Monday at the BSE.
The SBI official clarified that there were some inter-quarter numbers included in both slippages and upgrades. These were accounts that slipped during the quarter and were upgraded during the same quarter. The standard practice at banks is that interquarter slippages if recovered in the same quarter are not shown either as slippages or upgrades. Therefore, SBI has now removed it from both slippages and upgrades as per standard practices. As a result the upgrades figures have also been revised from R3,000 crore to around R1,600 crore.
Slippages refer to those loan accounts that have slipped into the non-performing asset (NPA) category from a standard account. The total stressed assets (slippages + restructured loans) on account of this revision stands at R11,800 crore. The bank restructured assets to the tune of R4,694 crore during the quarter. A Standard Chartered note said that the the R1,389 crore relates to accounts including Bharti Shipyard, Hotel Leela and Bilcare. “Bharti Shipyard and Hotel Leela slipped during 2QFY13 as NPLs but were upgraded in the same quarter upon restructuring. For Bilcare the amount was recovered,” the note said.
Some of the accounts that did slip into NPA in the quarter included Nitco Tiles, Max Mobile, Kamat Hotels and Reid and Taylor, S Kumars. SBI's asset quality deteriorated during the quarter with gross NPAs sequentially rising by 18 bps to 5.15% and net NPAs up 22 bps to 2.44%. The public sector lender's gross NPAs were up by around R2,000 crore to R49,202 crore; in the June quarter they had risen R7,480 crore to R47,156 crore in the April-June quarter. During the July-September quarter the bank posted a net profit growth of 30% yoy to R4,575 crore, while the operating profit fell 1.6% yoy to R7,353 crore.
The growth in the bank's net interest income (NII) or the difference between interest earned and paid out was a modest 5.3% yoy to R10,974 crore because the bank's loan growth was a little slow, particularly in the