The country's largest lender SBI witnessed a rebound in domestic advances growth to 5.67 per cent in 2020-21, while corporate credit de-grew over 3 per cent, the bank said in its annual report for FY21 released on Friday.
State Bank of India (SBI) said that despite the ongoing pandemic, its business growth remained robust in the financial year ended March 2021.
Deposits grew in double digits, while advances rebounded compared to the preceding fiscal year, it said.
Credit off-take of all the scheduled commercial banks (SCBs) continued its downward momentum and grew at a 59-year low of 5.6 per cent, SBI said.
However, SBI's domestic advances growth has rebounded and grew 5.67 per cent to over Rs 21.82 lakh crore as against 3.75 per cent growth in FY2020, SBI said in its annual report.
The foreign offices' advances growth contracted 0.14 per cent to Rs 3.57 lakh crore. Thus, the gross advances grew 4.81 per cent to Rs 25.39 lakh crore in FY2020-21 from the previous year level of Rs 24.23 lakh crore, it said.
The bank's strong domestic loan growth was led by growth in retail personal loans, which grew 16.47 per cent to Rs 8.71 crore during the reported year, driven by home loans, Xpress credit and gold loans, said the state-owned lender.
The growth was in line with the bank's strategy towards this segment led by robust digital channels, it said.
Within retail & home loans, Xpress credit, and gold loans grew substantially by 10.51 per cent to Rs 5,03,779 crore, 36.49 per cent to Rs 1,92,780 crore and 465.08 per cent to Rs 20,987 crore, respectively, SBI said.
"These segments constitute around 82.41 per cent of the total personal loans.
"With this robust growth, your bank's market share in home loans is at 34.53 per cent and 31.74 per cent in auto loans. The growth in Xpress credit is mainly driven by our digital YONO and INB platforms," SBI said.
The bank said the growth in the corporate segment remained subdued and declined 3.02 per cent to Rs 8,18,705 crore in 2020-21, which is in line with the banking industry's growth trend.
"If we include investments in commercial paper (CP) and corporate bonds in corporate credit, it increased by 2.64 per cent in FY2021, while there was negative growth in the loans portfolio.
"This indicates that corporates have raised money from the CP market due to the low interest rate environment," it added.
Total deposits of the bank grew 13.56 per cent - SCBs' growth stood at 11.40 per cent - to Rs 36.81 lakh crore from a year ago's Rs 32.42 lakh crore. The high growth in deposits has pushed SBI's market share up by 0.45 percentage points to 23.29 per cent, SBI said.
However, deposits at foreign offices contracted by 5.04 per cent to Rs 1.11 lakh crore. The domestic deposits were up by 14.26 per cent to Rs 35.70 lakh crore. SBI said it closed four foreign offices by rationalising offices with sub-optimal performance, enabling improvement of cost efficiencies.
On the profitability front, SBI said, "The FY2021 has been an unprecedented challenging year for the whole world and your bank was not an exception." It, however, added that with a pragmatic view and timely decisions of the management and execution, the bank has reported "the highest-ever standalone net profit of Rs 20,410 crore as against net profit of Rs 14,488 crore in previous year".
The lender said it has reported a significant improvement in asset quality, provision coverage, net interest margin and yield on advances.
A decline in credit cost by 75 basis points year-on-year to 1.12 per cent at the end of 2020-21 has been a significant improvement over the previous year.
SBI Chairman Dinesh Kumar Khara acknowledged the year gone by as an exception in the bank's recorded history and said the banking operations were sustained against all odds with minimal disruption for the customers.
Khara added that the bank is comfortably placed in terms of growth capital.
"Opportunities for lending in promising sectors will be explored to diversify and contain risk. Overall, despite the economic headwinds, the bank has adjusted to the challenges posed by the COVID-19 pandemic and is better positioned to tackle any subsequent wave.
"I am more than hopeful that the performance achieved in FY2021 will continue in FY2022 as well," Khara said.
He added that the current fiscal year has begun with an unexpected second wave of coronavirus infections.
It is too early to take a call of a possible deterioration of asset quality in banks due to the second wave, Khara added.
SBI said the aggregate demand continues to be low and household income has been impaired. An effective roll-out of immunisation is sure to turn the tide in the positive direction, it said.
It also added that in the current financial year, the bank will continue to accelerate its digital agenda.