State Bank of India (SBI) Chairman Challa Sreenivasulu Setty during a press conference to announce the Q1 FY26 results, in Mumbai, Friday. (PTI Photo)The country’s largest lender, State Bank of India (SBI), on Friday reported a 12.48 per cent growth in its net profit at Rs 19,160 crore during the quarter ended June 2025, compared to Rs 17.035 crore in the year-ago period.Despite the uncertain global macroeconomic environment driven by tariff policies and geopolitical tensions, SBI has maintained its earlier loan growth target of 12 per cent for the current financial year (FY2026), the bank’s Chairman C S Setty said.“There has been a good containment of operating expenses. Besides, on a year-on-year basis, our treasury gains have also added to profit,” Setty said.While the bank was able to maintain its core net interest income, it did not see a major fall in its net interest income (NII), despite almost 30 per cent of the book being repriced immediately on the external benchmark linked lending rate (EBLR) front, he said.Following a 100 basis points (bps) cut in the repo rate between February and June 2025, all loans linked to the repo rate have been reduced by a similar margin.The bank’s non-interest income jumped 55 per cent, on back of a 352 per cent growth in forex income.The lender’s net interest income fell marginally by 0.13 per cent to Rs 41,072 crore. Net interest margin (NIM) of the lender dropped by 33 basis points (bps) to 3.02 per cent in Q1FY26, compared to 3.35 per cent in the year-ago period.Story continues below this adSetty said the growth in NIM is likely to be U-shaped, with moderation in Q1 and Q2, and pick up in the fourth quarter of the current fiscal.Gross non-performing loans (NPAs) improved to 1.83 per cent from 2.21 per cent, and net NPA stood at 0.47 per cent, as against 0.57 per cent.The bank’s gross advances increased by 11.61 per cent to Rs 42,54,516 crore and domestic advances registered a growth of 11.06 per cent.Loans to small and medium enterprises (SME) grew by 19.1 per cent, followed by agri advances which rose 12.67 per cent. Retail personal advances grew by 12.56 per cent.Story continues below this adThe bank’s corporate advances recorded a slower growth of 5.7 per cent on y-o-y basis and a quarter-on-quarter decline of 3 per cent. Setty attributed the muted growth in corporate loans to delay in investment decisions due to tariff related uncertainties, shift by companies from banks to market instruments for funding and on account of pre-payments.“We have seen that the utilisation of working capital which was 62 per cent in Q1 of FY25 has come down to 58 per cent now. Also, we have seen that some of the large corporates are accessing the commercial paper (CP) market basically to replace the working capital limits,” the SBI chairman said.He expects the corporate loan book to grow at 10 per cent in the third quarter of FY26. The bank has a total corporate loan book pipeline of Rs 7 lakh crore.Commenting on the impact of the higher tariffs on the banking system, Setty said banks have limited exposure to sectors likely to be affected. These include leather, chemicals, footwear, gems and jewellery, textiles and shrimp.Story continues below this adThe bank’s share price closed at Rs 804.55 apiece, down 0.09 per cent on Friday after the quarterly results were declared.© The Indian Express Pvt LtdTags:State Bank of India