Summary
State Bank of India - Q3 FY2026 Earnings Call Summary Friday, February 7, 2026, 5:00 PM IST
Event Participants
Executives 8 A Ravi Shankar, Anindya Sunder Paul, Ashwini Kumar Tewari, C S Setty, Pawan Kumar, Rama Mohan Rao Amara, Rana Ashutosh Kumar Singh, Ravi Ranjan
Analysts 8 Ankit Bihani, Ashok Ajmera, Chintan Joshi, Jai Mundhra, Jeet Suchak, Kunal Shah, Mahrukh Adajania, Nitin Agarwal
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Deposits | ₹57 lakh crores | +9.02% YoY; Current Account grew +10.32% YoY; Retail term deposits grew +14.54% YoY. |
| Advances | ₹47 lakh crores | +15.14% YoY; Credit-Deposit ratio improved +404 bps YoY to 72.98%. |
| Gross NPA | 1.57% | -50 bps YoY; Management noted this is the lowest level in over two decades. |
| Net NPA | 0.39% | -14 bps YoY; Reflects disciplined underwriting and sustained recoveries. |
| Provision Coverage Ratio (PCR) | 75.54% | +88 bps YoY; Includes AUCA (Accounts Under Collection Assessment). |
| Net Profit | ₹21,028 crores | +24.49% YoY; Highest-ever quarterly profit driven by higher operating profit and low credit costs. |
| Net Interest Income (NII) | ₹45,190 crores | +9% YoY; Driven by credit growth and containing cost of resources. |
| Domestic NIM | 3.12% | Remained resilient; Management guides for 3% exit NIM for FY26. |
| ROA | 1.1% (est) | Consistently >1%; Management maintains a “through the cycle” guidance of 1%. |
| ROE | 20.68% | Strong internal capital generation supporting future growth. |
| Capital Adequacy (CAR) | 14.04% | +101 bps YoY; Remains well above regulatory minimums. |
Geographic & Segment Commentary
- Corporate Banking: Rebounded with 13.37% YoY growth. Pipeline remains strong at ₹7.86 lakh crores (undisbursed + new pipeline), with focus on power, renewables, and infrastructure.
- Retail (RAM): Secular growth across Retail, Agriculture, and SME. Personal gold loans grew significantly to ₹86,000 crores with an average LTV of 51.18%.
- International Banking: Deposits grew 8.32% YoY. Focus remains on wholesale banking in the US and EU, with retail expansion targeted via “YONO Global” digital app rather than physical branches.
- Agriculture: Gold loan portfolio stands at ₹1.44 lakh crores. Management noted average LTV in Agri-gold is 54.89% with negligible auction rates.
Company-Specific & Strategic Commentary
- Digital Transformation (YONO): New YONO launch saw 3 crore registrations in one month; total registered users reached 9.65 crores. Strategy aims to double users to 20 crores in 2-3 years to drive operating leverage.
- Customer Value Enhancement (CVE): Cross-sell income (Banca, Mutual Funds) is targeted to reach $1 billion annually. A special dividend of ₹2,200 crores was received from SBI Mutual Fund this quarter.
- Sunrise Sectors (CHAKRA): Established a Centre of Excellence to institutionalize prudent capital allocation in emerging segments like green energy and data centers.
- Operational Efficiency: Deploying 10,000 “Seva Sarathis” (floor coordinators) to migrate routine branch transactions to digital channels, reducing “cost to serve.”
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Credit Growth | 13% - 15% (Q4 FY26) | Revised upward from 12%-14% due to strong corporate rebound and RAM traction. |
| Net Interest Margin | ~3.00% (FY26 Exit) | Guidance of 3% “through the cycles” maintained despite EBLR repricing pressures. |
| Return on Assets (ROA) | 1.00% (Long-term) | Aiming for consistency at scale despite RWA density consciousness. |
| Cost-to-Income | Below 50% | Expected to be maintained through digital migration and overhead controls. |
Risks & Constraints
| Risk | Context |
|---|---|
| Deposit Fragmentation | Increasing financialization of household savings into markets is making CASA mobilization competitive. Current CASA ratio sits at 39.13%. |
| Interest Rate Transmission | The 25 bps repo rate cut in December impacts EBLR-linked assets immediately (~48% of book), while deposit repricing lags. |
| Priority Sector Lending (PSL) | Meeting Small & Marginal Farmer (SMF) sub-targets remains a challenge at scale; SBI front-loaded PSLC purchases in Q2 to mitigate year-end cost spikes. |
Q&A Highlights
Yields and NIMs
- Question: Will the December rate cut and higher LDR improve or compress margins? (Chintan Joshi, Jai Mundhra)
- Answer: EBLR book (~48%) reprices immediately, while deposit rates haven’t been cut yet. However, 3% NIM is sustainable through cycles by focusing on high-yield retail and ecosystem corporate banking (C.S. Setty).
Corporate Pipeline
- Question: What is the outlook for private capex and the corporate loan pipeline? (Pritesh)
- Answer: Total pipeline plus undisbursed sanctions is ₹7.86 lakh crores. Growth is visible in renewables, metals, and infra, with new opportunities in REITs and M&A (Ashwini Kumar Tewari).
Gold Loan Growth
- Question: Is the 95% YoY growth in personal gold loans sustainable or a risk? (Jai Mundhra)
- Answer: Growth is partly due to customers shifting from Xpress Credit for better LTV/rates. Average LTV is very safe at 51%, and auctions are negligible (C.S. Setty).
Treasury & Other Income
- Question: What drove the surge in miscellaneous income? (Ankit Bihani)
- Answer: Primarily a ₹2,200 crore dividend from SBI Mutual Fund and ₹2,600 crore recovery from written-off accounts (C.S. Setty).
Key Takeaway
SBI delivered a record quarterly performance in Q3 FY26, characterized by its highest-ever net profit of ₹21,028 crores and total business surpassing the ₹103 trillion milestone. Credit growth was robust at 15.14% YoY, prompting management to upgrade Q4 guidance to 13-15% as corporate demand joins sustained retail momentum. Asset quality remains at decadal highs with a Gross NPA of 1.57% and a negligible credit cost of 0.29%. Strategically, the bank is aggressively “YONO-izing” its operations, having registered 30 million users on its new platform in just one month, while simultaneously targeting $1 billion in cross-sell income. Despite industry-wide pressures on CASA and NIMs, SBI maintains a confident outlook with a 1% ROA and 3% NIM target “through the cycles.” The bank is well-positioned to capitalize on India’s infrastructure push and trade deals, backed by a strong ₹7.86 lakh crore corporate pipeline.
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