State Bank of India (SBI), the country’s largest commercial bank, delivered a strong earnings performance in the December quarter of FY26, with standalone net profit rising 24.49% year-on-year to ₹21,028 crore. The sharp improvement was driven primarily by lower provisioning costs and sustained asset quality gains, even as margins moderated marginally.
The standout feature of the quarter was the continued clean-up of the loan book. Gross NPAs declined sequentially to ₹73,636.8 crore from ₹76,243 crore in the September quarter, while net NPAs fell to ₹18,012 crore from ₹18,460 crore. As a result, the gross NPA ratio improved to 1.57% from 1.73% QoQ, and net NPA ratio eased to 0.39% from 0.42%, underscoring improving credit discipline across segments.
Provisioning requirements fell sharply, with provisions dropping to ₹4,506 crore, compared with ₹5,400 crore in Q2FY26 and significantly lower than the year-ago level. Credit cost for the quarter stood at a benign 0.29%, while the slippage ratio remained well-contained at 0.40%, indicating limited fresh stress formation.
The bank’s provision coverage ratio (PCR) also strengthened, rising 88 basis points year-on-year to 75.54%, and reaching 92.37% when including AUCA, giving SBI a strong buffer against potential asset quality shocks.
Net interest income (NII) grew 9% year-on-year to ₹45,190 crore, supported by healthy loan growth across segments. However, net interest margin (NIM) edged lower to 3.12% from 3.15% a year earlier, reflecting rising funding costs and a competitive deposit environment. While margin pressure remains a sector-wide theme, SBI’s scale and improving asset mix continue to cushion the impact.
SBI reported robust balance sheet expansion, with whole bank advances growing 15.14% YoY. Domestic advances rose 15.44%, while foreign office advances increased 13.41%.
Growth was led by the SME segment, which expanded 21.02% YoY, followed by agriculture advances at 16.56% and retail advances at 16.51%, with double-digit growth across all retail sub-segments. Retail personal loans grew 14.95%, while corporate advances rose a steady 13.37%, reflecting a balanced recovery across demand segments.
On the liabilities side, deposits grew 9.02% YoY. CASA deposits rose 8.88%, with the CASA ratio standing at 39.13% as of December 31, 2025. Retail term deposits grew a strong 14.54% YoY, highlighting SBI’s ability to mobilise stable funding in a tight liquidity environment.
SBI’s digital strategy continued to gain traction, with over 68% of savings bank accounts opened digitally through YONO during the quarter. The share of alternate channels in total transactions increased to approximately 98.6% in 9MFY26, reinforcing operating leverage and cost efficiency over the medium term.