SBI Annual Report- Key Takeaways
10-06-2022

Theme: Setting New Standards in Banking Excellence

Excerpts from the FY22 SBI Annual report-

"SBI is no stranger to embracing technology disruptions. In our desire to future-proof our businesses, we have adopted fintech as an opportunity to automate decision-making and improve efficiency. If the rising adoption of online and mobile banking in millennials is any indication, it is likely that the brick-and-mortar banking will have less relevance to the younger generation. The cashless economy is driving digital transformation faster than ever, with more banking organisations adopting digital banking. At SBI, we are highly cognisant of this trend, and we are leading the digital transformation drive to serve an increasingly digital India" SBI has been one of the earky adopters of technology in its business operations. It has leveraged its size and scale to reach a better position to survive and thrive in the digital age.

"Using technology, we have enhanced our ability to sense, think and act, and augment decision-making process. What’s more? We are using technology to capture deeper insights to address customer’s pain points at various points of contact. This is unifying all our systems for an enhanced customer experience. As a result, our customers can do more in lesser time."

YONO resembles the success that the bank has achieved and the same is visible in the numbers of YONO.

"Our flagship all-encompassing digital platform, YONO, is testimony to our prowess in delivering cutting-edge digital services to millions of customers. Customers are increasingly choosing to bank with us online and YONO is seamlessly connecting us with them.

As of 31st March 2022, YONO has set a record with 111.74 million downloads, 26K new digital Savings Bank accounts per day and 48.35 million registered users. These numbers are telling indicators of the potential digital banking holds for SBI. At SBI, we are using the power of analytics to help us lower the barriers to omni-channel digital banking adoption."

Stellar Business Performance in FY22

Total Income: Rs 406,973 Cr (6% growth)

Gross NPA: 3.97% (4.98% in FY21)

Net Profit: Rs 36,356 Cr (50% growth)

Total Customers: 46.77 Cr (added 85 lakh new customers)

Branches & ATMs: 22,266 & 65,030 respectively

SBI’s Advances stood at Rs. 27,94,076 Cr for the FY22, registering a growth of 11.7% on a YoY basis. Bank’s Net Interest Income was at Rs. 1,20,708 Cr for FY22, registering a growth of 9%.

Savings Account Deposits grew by 10.5% to Rs. 15,26,857 crore while Current Account Deposits declined 3.5% to Rs. 2,76,724 crore. Time Deposits stood at Rs. 22,47,953 crore, representing an increase of 11.8%. CASA Deposits accounted for 45.3% of Total Deposits, second highest in the industry after Kotak Mahindra Bank.

Diversified Revenue Mix from Core Business:

  • Retail Banking (44%)
  • Wholesale Banking (24%)
  • Treasury (32%)

Healthy Loan Book breakup:

Highlights from the management

  1. Improvement in Credit Environment- With the gradual improvement in economic activity, SBI’s business has continued to show double digit growth in FY22. The retail personal loans portfolio has crossed Rs. 10 lakh crore mark driven by Home loans and unsecured Personal loans, which grew by 11.49% and 28.50% respectively during FY22.  SBI has been continuously outpacing the growth curve and garnered market share of 35.3% in home loans.
  2. Good performance from Subsidiaries- SBI Life grew profit after tax by 3.4%, while SBI Funds and SBI Cards reported growth of 23% and 64% respectively. All three are one of the largest players in their respective industry.
  3. Bouncing back strong after Covid Impact-As the economy recovered from the effects of COVID-19 during the second half, Bank’s performance displayed a smart recovery. The standalone net profit has increased by 55% over previous year to Rs.31,676 crore in FY2022. Bank has also registered improvement on the asset quality front, provision coverage and NIM.
  4. Improving Metrics- There was a significant improvement in Return on Equity which moved up by 398 bps to 13.92% in FY2022 from 9.94% in the previous year.

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Future Prospects given by Management

  1. Overall FY2022 has been a much better year compared to FY2021. The pace of economic activity has picked up and the momentum is expected to continue. The outbreak of hostilities between Ukraine and Russia towards the end of FY2022 has severely affected the global economic landscape.
  2. The time is, therefore, opportune to undertake the much-needed transformation of the Bank with an eye on emerging trends in banking, especially in India. SBI will thus continue to accelerate its digital agenda both in front and back offices. In business operations, SBI will leverage advanced analytics for deeper insights on internal data and its best possible usage. Mutually beneficial partnerships with fin-techs and NBFCs will be explored further to increase penetration and reach of the Bank.
  3. Bank is comfortably placed in terms of growth capital in the current year. Opportunities for lending in promising sectors such as sectors identified under PLI scheme and renewables as well as electric mobility will be explored to diversify the portfolio.
  4. Summing up, despite the economic headwinds, your Bank has adapted well to the challenges posed by the operating environment. SBI is more than hopeful that the performance achieved in FY2022 will show further improvement in FY2023.

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