Page 6 - Banking Finance December 2024

BANK UPDATE

Bank of India, Indian Overseas Bank, The ministry said that the global credit profit of Rs 18,331 crore for the Sept
UCO Bank, and Punjab and Sind Bank, and deposit portfolio of PSBs grew by quarter, up 28% from Rs 14,330 crore
the source said. 12.9 per cent and 9.5 per cent Y-o-Y to a year ago. This is the highest net

The Central government owns more Rs 102.29 trillion and Rs 133.75 trillion profit reported by any entity for the
than 93 per cent in Central Bank of respectively. period. SBI's standalone profit in the
India, 96.4 per cent in Indian Overseas "Under the leadership of the Prime preceding quarter stood at Rs 17,035
crore.
Bank, 95.4 per cent in UCO Bank and Minister, Narendra Modi, and the guid-
98.3 per cent in Punjab and Sind Bank ance of the Union Minister for Finance On a consolidated basis, the bank's net
as of end-September, according to data and Corporate Affairs, Nirmala profit for Q2 FY25 was up 23% at Rs
on the BSE's website. Sitharaman, major banking reforms like 19,782 crore. During the period, the

The plan under consideration is to sell Implementation of Enhance Access and bank crossed the Rs 50 lakh crore de-
the stake through an offer for sale in the Service Excellence (EASE), enactment posit milestone. Its advances grew
open market, the source said. Shares of of Insolvency and Bankruptcy Code 14.9% year-on-year to Rs 39.2 lakh
(IBC), putting in place a robust Gover- crore while deposits grew 9.1% to
the banks rose between 3 per cent and
4 per cent following the report. nance Framework, setting up of Na- nearly Rs 51.2 lakh crore.
tional Asset Reconstruction Company
The Securities and Exchange Board of Ltd. (NARCL), amalgamation of PSBs SBI's core net interest income rose
India (SEBI) requires listed companies 5.37% to Rs 41,620 crore, driven by a
among others., were undertaken in the 15% increase in advances despite a
to maintain a 25 per cent public last few years," the finance ministry
shareholding, but has exempted gov- said in a statement. 0.15% dip in net interest margin to
ernment-owned firms from meeting 3.14%. Non-interest income also saw
The gross and net NPA stood at 3.12 a significant surge of 42%, reaching Rs
these norms till August 2026.
per cent and 0.63 per cent as of Sep- 15,271 crore, boosted by gains from
The source did not comment on whether tember 2024. Gross and net NPA de- forex and treasury operations. Newly
the government will be able to meet the clined by 108 bps and 34 bps respec- appointed chairman C S Setty main-
regulator's deadline or whether it would tively Y-o-Y. tained the advances growth target at
seek a further extension. 14-16% for the fiscal but revised the
The official said the timing and the SBI net up 28% at Rs. deposit growth target to around 10%,
quantum of the sale would be decided 18000 crore in September down from the earlier 12-13%. Setty
based on market conditions. The offi- expressed confidence in achieving
cial did not want to be named as he is quarter double-digit deposit growth.
not authorised to speak to the media. State Bank of India reported a net While announcing the results, Setty

Net profit to PSBs up 26% Banks offer to park higher amount with RBI via VRRR

in HIFY25, says FinMin route
The Union Finance Ministry said that In an indication of excess liquidity, the Reserve Bank of India received bids
aggregate business of public sector worth Rs. 58,525 crore from banks against the notified amount of Rs. 50,000
banks (PSBs) has shown strong growth crore at the variable rate reverse repo (VRRR) auction held. This is the first
of 11 per cent in the first half of the time in many months when the bid amount was higher than the notified
financial year 2024-25 (H1FY25) to amount. RBI has been conducting VRRR auctions almost everyday to suck
touch Rs 236 trillion. The operating out liquidity but banks have been wary of parking funds.
and net profit were also robust. "There is excess liquidity now therefore banks may be willing to park funds
At Rs 1.5 trillion, operating profit grew with RBI," said a banker. Recently, RBI has been conducting two VRRR auc-
by 14.4 per cent year-on-year (Y-o-Y) tions on the same day. During the past few months banks had turned reluc-
while the net profit saw an impressive tant to park their funds with the RBI for a longer tenure in the variable
25.6 per cent jump at Rs 85,520 crore rate reverse repo auctions. The shift could indicate that RBI may conduct
in the first half of FY25. more VRRR auctions in the coming days.

6 | 2024 | DECEMBER | BANKING FINANCE