The largest lender of the country, State Bank of India has posted a 25% rise in its net profits for the first quarter of this fiscal. The rise has been attributed to increasing loan demand and earnings from retail banking.
"Net profit for the April-June period rose to Rs 2,914 crore from Rs 2,330 crore a year earlier," said chairman O.P. Bhatt.
3G and wireless broadband auctions have added most to the benefit earned by the bank.
The bank will soon be taking steps on its deposit as well as lending rates as is now being done by most banks. It is expected that there will be atleast 0.25% rise in both rates for the bank.
"There is an upward bias on interest rates ... on both deposit and lending rates. We will review deposit rates and benchmark prime lending rate," Bhatt said.
Many lenders like Punjab National Bank, Bank of Baroda and Canara Bank, have raised lending rates following the policy rate hike by RBI.
The bank's credit offtake has seen a 21% rise this quarter as compared to the figures last year for the same. Loans have climbed to Rs 6.64 lakh crore.
Interest income has grown 6 per cent to Rs 18,452 crore from Rs 17,473 crore. Capital adequacy ratio has been reported to be 13.54% which is higher than the benchmark 9% but lower than last year's figures of 14.12%.