SBI reports 12 per cent rise in net profits

SBI reports 12 per cent rise in net profitsThe State Bank of India (SBI) has reported an increase of 12 per cent in net profit in the second quarter to Rs 2810 crore compared to Rs 2501 crore for the same period of previous fiscal.

The country's largest lender had seen a steep decline in net profits for the first quarter of this fiscal by 46 per cent to Rs 1584 crore. The second quarter has helped the bank recover the decline. The total income for the bank rose to Rs 41249.08 crore for this period.

The State Bank of India chairman, Pratip Chaudhuri has said that it is unlikely that the bank will increase its savings bank account rate saying that the SBI believes that the people will continue to trust services provided by the bank. Diwakar Gupta, Managing Director & chief financial officer, SBI also said that clearly that the SBI will not be the first state-run bank to increase interest rates.

Meanwhile, worsening the prospects of the economy, Moody's Investor Service decided to downgrade the outlook for India's banking system to "negative" from "stable" on Wednesday.

Moody said that the slowing growth in the domestic as well as international markets was affecting asset quality, capitalization and profitability of the Indian banks. It said in a statement that a slowdown in growth as well as an increased borrowing by the government is set to reduce funds available in the private credit market.