State Bank of India (SBI) reported a loss of Rs. 7,718 crore ($1.1 billion), its biggest ever, in the January-March quarter, as the country’s biggest lender, set aside more provisions for bad loans after a change in banking regulation.
The loss for the three months to March 31 was deeper than the expected loss of 12.85 billion rupees on average by 16 analysts, according to some sources. The result also compared with a restated net loss of 34.42 billion rupees in the same period a year earlier.
Banks saw soured loans and provisions surge in the quarter after the Reserve Bank of India (RBI) in February eliminated half a dozen loan restructuring schemes to hasten the clean-up of near-record levels of bad debt. Most state-run banks that have reported quarterly earnings so far have posted losses.
Earlier this month, another state-run lender Punjab National Bank (PNB) had reported a net loss of Rs. 13,417 crore in the fourth quarter, the biggest ever by an Indian bank as PNB booked provisions to cover a massive fraud.
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