"Accordingly, additional provision of Rs 92.94 crore has been made during the quarter, leaving a balance provision of Rs 185.88 crore to be proportionately spread over the remaining two quarters till March 2018", it said. "Further, the new management chose to strengthen the balance sheet over profitability by increasing provision coverage ratio".
Operating profit for the lender surged by 26.03 per cent to Rs 1,223 crore in the second quarter of the current fiscal as compared to Rs 970 crore in the year-ago period.
Standalone profit of the bank fell sharply by 38 percent to Rs 1,581.55 crore, dented by higher provisions for bad loan accounts referred for insolvency proceedings at the National Company Law Tribunal (NCLT).
"This time we had some cushion available from SBI Life stake sale". The insurance venture had held an initial public offering during the second quarter, helping SBI partly dilute its holding in the insurer.
"Deposit rate unless you cut you can not cut lending rate ... for time being we are in for much more stable interest rate", he said.
EBITDA for the quarter fell by 19.2% to Rs 181 cr as compared to corresponding quarter in the previous year with a corresponding margin contraction of 286 bps.
Net interest income grew by 27.3 percent year-on-year to Rs 18,585.9 crore in Q2 despite tepid loan growth.
"The results were comforting to see and is probably the best set of numbers from SBI that we've seen in the recent past especially when there is still uncertainty over non performing loans issue", said Aalok Shah, a banking sector analyst at Mumbai's Centrum Broking.
Between April and September, the lender's staff strength declined by more than 10,000 - to 2,69,219, from 2,79,803 as 11,382 employees retired during the quarter and only 798 people joined the bank.
Sriram said the bank has made nearly 75 per cent of the provisioning required for the accounts in the second list of NCLT cases.
NPA provisions at the state-run lender declined to ₹1,867 crore in the second quarter from ₹2,190 crore a year earlier and ₹2,156 crore in the preceding three-month period.
The net profit of India's largest bank in the reporting quarter (Q2FY18), however, is lower than in the first quarter (₹2,006 crore).
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