SBI's Strategic Financial Goals

The State Bank of India (SBI) is set to maintain a robust return on assets (RoA) exceeding 1% in the fiscal year 2026, despite anticipated pressures on margins from the softening interest rate cycle, as stated by Chairman C S Setty.

Key Profitability Metrics: RoA, a critical indicator of how efficiently a company utilizes its assets to generate profit, remains a focal point for SBI. Chairman Setty emphasized the bank's commitment to achieving an RoE of over 15% consistently across business cycles.

Navigating Interest Rate Changes

With the easing repo rate cycle potentially impacting net interest margins (NIM), SBI plans to adjust its deposit rates in alignment with repo rate cuts to safeguard margins. Setty highlighted the importance of this strategy in maintaining financial stability.

Financial Performance Highlights

For FY25, SBI reported an RoA improvement from 1.04% to 1.10%, with RoE steady at around 20%. The bank's balance sheet expanded significantly, reaching ₹66 lakh crore, and operating profit surpassed ₹1.1 lakh crore. Net profit also hit a record high, marking a 16% increase from the previous year.

Asset Quality and Future Plans

SBI has made notable progress in asset quality, with gross NPAs dropping to 1.82% and net NPAs to 0.47%. The bank is also preparing to raise up to ₹25,000 crore in equity capital, though Setty noted that current profitability and growth profiles provide sufficient headroom for business expansion.