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SBI's Record Profit Marred by Treasury Losses
9 May
Summary
- SBI posted a record ₹83,299 crore profit in FY26.
- Stock fell amid concerns over margin compression.
- Treasury losses accelerated in the March quarter.
State Bank of India (SBI) reported a significant annual corporate profit of ₹83,299 crore for FY26, positioning it second only to Reliance Industries in India. This achievement was underpinned by robust loan growth across corporate, retail, and agricultural sectors, with credit expected to expand 13-15% in the current fiscal year.
Despite the strong profit figures, SBI's stock experienced a notable decline. Investors expressed concerns regarding margin compression, as the domestic net interest margin (NIM) narrowed to 2.93% in March 2026 from 3.14% a year prior. This pressure on yields contributed to losses in the bank's treasury operations.
The bank's treasury business incurred substantial losses, primarily due to unwinding forex positions after regulatory changes by the Reserve Bank of India (RBI) capped net open rupee positions. These treasury losses, coupled with margin concerns, overshadowed the overall profit growth in the March quarter, where net profit climbed 6% to ₹19,684 crore.
