State Bank of India (SBI) Chairman CS Setty has dismissed concerns over a sequential deterioration in the lender’s asset quality and a possible slowdown in private sector capital expenditure, saying quarterly comparisons can be misleading because of seasonal patterns in banking.
Speaking at SBI’s recent financial results press conference, Setty said the bank remains confident about its performance for the full financial year and advised against drawing conclusions from first-quarter figures alone.
Highlights Seasonal Impact On Q1 Performance
Setty was responding to questions about gross non-performing assets (GNPAs), which rose to ₹74,273 crore, and slippages, which stood at 0.57%. He was also asked whether the 0.28% quarter-on-quarter decline in corporate advances indicated weaker private capital expenditure.
The SBI chief said the first quarter is typically different from the remaining quarters in terms of business activity, yields and credit expansion. He pointed out that lending and other banking parameters generally strengthen during the second, third and fourth quarters.
According to Setty, the bank’s performance shows a meaningful improvement when compared with the same period last year. Recoveries and upgrades during the quarter also reduced stress by around ₹4,900 crore, indicating that there was no significant deterioration in the overall portfolio.
He also rejected concerns that rapid growth in agricultural and SME lending could result in higher defaults. Agriculture advances increased 25.43%, while SME loans grew 22.33%.
SBI Maintains FY27 Credit Growth Target
Setty said the bank’s SME expansion is supported significantly by loans under the Emergency Credit Line Guarantee Scheme (ECLGS), while agricultural growth is coming from institutional finance, investment credit and other structured lending segments.
He maintained that these areas represent relatively strong-quality portfolios and that overall risks remain under control.
SBI has retained its full-year credit growth guidance of 14-15%, supported by demand across retail, corporate and MSME segments. Deposit growth is expected to remain in the 10-11% range, helped by healthy retail current account savings account (CASA) growth.
