SBI Q2 profit grows by 40 per cent

Beating projections, India’s leading financial conglomerate State Bank of India has posted 40 per cent growth in net profit for the second quarter of this fiscal on high interest income.

Crediting the good numbers to income from high interest rates and fee-based income, SBI Chairman O P Bhatt said bank has been giving good returns consistently in the last 5-6 quarters and growth has beaten projections by analysts.

SBI has posted a net profit of Rs 2,259.72 crore for the quarter, a growth of 40 per cent against 36 per cent in the same quarter a year ago. The bank’s profit in the September quarter last year stood at Rs 1,611.42 crore.

The total income rose to Rs 17,909.64 crore in the second quarter from Rs 13,658.22 crore a year ago, an increase of 31 per cent.

The bank registered a deposit growth of 67.93 per cent at Rs 57,861 crore. Its current and savings account (CASA) ratio was up by 26 basis points to 39.71 per cent. Advances of the bank grew by 162.35 per cent to Rs 51,020 crore.

Return on assets was flat at 0.99 per cent, while return on equity was at 14.64 per cent at the end of September 2008.

Besides, home loans grew by 23.47 per cent, auto loans by 30.48 per cent and education loan by 43.81 per cent.

Submit KYC details to avoid account freeze: SBI

Country’s largest lender State Bank of India on Thursday asked its customers to immediately comply with the Know-Your-Customer guidelines, failing which their accounts would be freezed.

“All account holders of the bank who have not yet complied with the KYC guidelines are hereby requested to make their accounts KYC compliant by contacting their home branches and completing the required documentation latest by October 31,” SBI said in a notice.

As per provisions of the Prevention of Money Laundering Act 2002 and the direction given by RBI, all customers are required to comply with KYC guidelines.

Banks were advised to follow certain customer identification procedures for opening of accounts and monitoring of transactions of suspicious nature by the RBI in context of the recommendations made by the Financial Action Task Force on Anti-Money Laundering standards and on Combating Financing of Terrorism.

Failing to comply with the guidelines would result in freezing of account operations, it said.

“Several account holders have still not submitted local address and identity proofs, thereby violating the KYC guidelines issued by the apex bank on account opening,” a senior SBI official said.

Despite repeated reminders sent by the bank through registered and regular posts to such customers, there has not been any response yet and it seems they are not interested in operating the accounts, he said.

It is a final notice after which the accounts would be freezed, the official added.

The largest bank having a branch network of about 10,400 has over 13 crore customers.

SBI to launch new services from its Dubai center

State Bank of India (SBI) is set to expand its footprint in the Gulf, with an offer of brand new services for its clients in the United Arab Emirates (UAE). Armed with a Category 1 licence from the Dubai Financial Services Authority (DFCA), SBI will now be in a position to accept deposits, provide credit, arrange credit for investments, and offer advice on financial products. The bank will launch its new operations from its branch at the Dubai International Financial Centre (DIFC), a rapidly growing global hub for banking, capital markets, insurance, asset management and other financial services.

“Our services are open to all nationals as we are determined to acquire a more prominent niche as a global player in international banking circles,” said A. J. Vidyasagar, Chief Executive Officer of SBI’s branch at DIFC. He added that SBI, ranked fifty seventh globally, already had a natural advantage of servicing Indian clients involved with trading activity or investments in the Gulf.

Mr. Vidyasagar pointed out that the branch would provide working capital as well as trade finance, both fund based and non-fund based, term loans and project financing.

SBI hikes deposit rate by 1 pc for 1,000 days maturity

Country’s largest lender State Bank of India today raised fixed deposit rate by 100 basis points to 10.50 per cent for 1,000 days maturity.

Deposit rates in between 2-3 year maturity has been revised to 12.50 per cent from 9.5 per cent, SBI said in a regulatory filing to the Bombay Stock Exchange.

For the same maturity senior citizens would get 0.5 per cent additional interest, it said.

Rate for other maturities have been kept unchanged at the previous level.

Shares of SBI were trading at Rs 1,392.75, down 2.89 per cent in early morning trade on the BSE.