SBI Eyes Q2 Deposit Uptick via FCNR(B), Keeps FY Growth at 10-11%

State Bank of India (SBI) expects its deposit growth to pick up in the second quarter of the current financial year, aided by inflows into Foreign Currency Non-Resident (Bank) [FCNR(B)] accounts. Chairman Challa Sreenivasulu Setty said the bank remains confident of achieving a full-year deposit growth of 10-11 per cent.

Speaking after the release of quarterly results, Setty noted that the country's largest lender has sufficient balance sheet liquidity to support its planned credit expansion without any funding constraints.

"Deposit growth, I think there would be some uptake because of the FCNR(B) in Q2, but overall we should be in the double-digit 10 to 11 per cent deposit growth," Setty said.

For the current fiscal year, SBI projects advances growth of 14-15 per cent, aligning its guidance with the expected nominal GDP. "We always align the credit growth, at least in our guidance, to nominal GDP. If we go by the GDP estimates and our own internal house view is that nominal GDP would be around 12 per cent, which means that 2 to 3 per cent over that nominal GDP has always been our guidance," Setty explained.

On margins, the bank reiterated its earlier guidance of a 3 per cent net interest margin (NIM) for the full year.

The announcements came as SBI reported a 10.23 per cent year-on-year rise in net profit to Rs 21,121 crore for the first quarter of FY2026-27, supported by strong net interest income and advances growth, along with improved asset quality. The lender had posted a net profit of Rs 19,160 crore in the same quarter last year.

Net interest income (NII) grew 14.88 per cent to Rs 46,992 crore from Rs 40,907 crore a year earlier. Operating profit rose 9.77 per cent to Rs 33,529 crore.

SBI's domestic NIM stood at 3 per cent in Q1 FY27, up 7 basis points sequentially but slightly lower than 3.01 per cent a year ago.

Gross advances rose 18.63 per cent year-on-year to Rs 50.47 lakh crore as of June 2026. Domestic advances grew 18.15 per cent, while corporate advances increased 18.05 per cent. Retail, agriculture and MSME (RAM) advances grew 18.20 per cent, with all segments recording double-digit growth.

Deposits increased 9.73 per cent year-on-year to Rs 60.06 lakh crore. CASA deposits grew 9.30 per cent, and the CASA ratio stood at 39.24 per cent. The bank's overall business crossed Rs 110 lakh crore during the quarter.

Asset quality improved, with the gross NPA ratio declining to 1.47 per cent from 1.83 per cent a year ago, and the net NPA ratio improving to 0.38 per cent from 0.47 per cent.

SBI also highlighted that over 64 per cent of savings bank accounts were opened digitally through YONO during Q1 FY27, and alternate channels accounted for about 98.8 per cent of total transactions.