SBBJ net profit up 12%, seeks Rs 500 crore capital from parent bank, SBI

MUMBAI: Higher treasury income and lower provisions for bad loans helped State Bank of Bikaner and Jaipur showed a 12% growth in net profit to Rs 188 crore for the first quarter of this fiscal year. Giving an outlook for the coming quarter, managing director, B Sriram said that he is confident that the credit and deposits growth will improve in the coming quarter, but indicated that stress on the loan book may continue for at least couple quarters.

He also indicate that the bank has asked for a Rs 500 crore capital from the parent bank, State Bank of India, if they have to maintain 15 to16% growth in credit. Its capital adequacy ratio- the amount of equity that banks has to own in proportion to its loans.

Profit from treasury rose to Rs 91 crore, up 600% on year while net interest income remained flat at Rs 662 crore for the first quarter over corresponding period. Provisions for bad loan was down 38.5% to Rs 128 crore. Mr Sriram said that the lower provision was largely due to higher provision made in corresponding quarter last year. Sriram said that the bank would be able maintain net interest margin which stood at 3.50%.

The banks deposit rose 4.28% to Rs 66748 crore. The share of low cost deposits – current and savings account- was 39.6% while bulk deposit was 7%. Credit rose 13.2% to Rs 57193 crore for quarter ending June 2013.