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SBI chairman Dinesh Kumar Khara.
India's top bank State Bank of India's profit after tax (PAT) for the past four years has surpassed the cumulative profit earned over the previous 64 years, according to chairman Dinesh Kumar Khara.
“In the last four years, we earned a net profit of ₹1.63 trillion. The same for the 64 years before that was ₹1.45 trillion,” Mr Khara told the media recently.
Khara retiring
Mr Khara, who has been at the bank's helm since October 2020, is set to step down soon. he said when he had assumed office, SBI's annual profit was around ₹14,000 crore. This had now risen to a PAT of ₹17,000 crore per quarter.
“My ambition was to see SBI generating ₹1 trillion profit after tax. Last year (FY24), we were about ₹80,00 crore, and I believe it will likely be a reality in FY 25.”
The significant improvement in profitability is attributed to resolving operational issues in lending, boosting other income, and enhancing employee productivity.
SBI's per-employee business has grown from ₹24 crore to about ₹38 crore in the past four years, while profit per employee has grown nearly six times to around ₹30 lakh.
Mr Khara, however, believes the bank is being undervalued by the market. While he acknowledged that valuation is ultimately determined by the market, he expressed dissatisfaction. “We are not getting our right value, it should be higher, look at the other players."
YONO 2.0 rollout soon
Mr Khara said SBI was a benchmark in itself due to its network of over 22,000 branches, strong brand presence, substantial balance sheet, comfortable liquidity buffers, and growth potential.
The average balance in SBI’s savings accounts was three times higher than that of its nearest competitor,--o around ₹17 trillion in June this year.
On the rollout of SBI's second-generation mobile banking application, YONO 2.0, Mr Khara said the bank is upgrading the app and will soon launch a beta version for testing. "YONO 2.0 may not be released all at once; it will be rolled out incrementally."
(By arrangement with livemint.com)
