New Delhi: State Bank of India chairman Rajnish Kumar on Thursday said the bank does not need any capital from the government.
"SBI doesn't need any capital from the government," Kumar said after a meeting with the Finance Minister for pre-Budget consultations with bankers where capital infusion in PSU banks was discussed.
In March this year, the SBI raised ₹1,251 crore in bonds to boost its additional tier 1 capital ratio while its board has extended the deadline to raise ₹20,000 crore till March next year.
The additional CET1 requirement will be in addition to the capital conservation buffer. Tier 1 capital is calculated as Common Equity Tier 1 (CET1) capital plus Additional Tier 1 (AT1) capital.
In 2018-19, the government had pumped in ₹1.6 trillion, the highest ever, into public sector banks, helping five lenders come out of the PCA framework and to meet regulatory and growth capital.
The interim budget presented in February did not provide any allocation for recapitalisation. In February this year and in the last fiscal, the government approved and later infused ₹48,239 crore recapitalisation plan for 12 public sector banks (PSBs), including the fraud-hit Punjab National Bank (PNB), to help them avoid and come out of the prompt corrective action (PCA) framework.
State Bank of India's balance sheet has been fully repaired in FY2019 even as it recorded a turnaround performance in the fourth quarter.
In Q4, the country's largest bank had reported a net profit of ₹838 crore against a net loss of ₹7,718 crore in the same period the previous year. It reported a substantial improvement in the asset quality, with lower fresh slippages and better recoveries.
The profit in the reporting quarter came on the back of a 15% year-on-year (Y-o-Y) increase in the net interest income (the difference between interest earned and interest expended) at ₹22,954 crore and lower loan-loss provisions of ₹17,336 crore (down 28 per cent Y-o-Y).
For the full-year ended March, the bank reported a net profit of ₹862 crore against a net loss of ₹6,547 crore in FY18. Gross NPAs declined from 10.91% of gross advances as at end-March 2018 to 7.53% as at end-March 2019 and the net NPAs fell from 5.73% of net advances to 3.01%.
The PCR improved from 66% to 79%. The bank said recovery in FY19 was at an all-time high of ₹31,512 crore. Of this, ₹13,836 crore came through the Insolvency and Bankruptcy Resolution process.
