Mumbai: India’s largest public sector lender, the State Bank of India (SBI), posted a notable rise in net profit for the quarter ending September 2025, driven by the sale of its stake in Yes Bank and a steady rebound in lending margins. The result underlines the bank’s resilience amid a challenging interest rate environment and its ability to capitalize on strategic investments.
SBI reported a net profit of ₹201.6 billion (approximately USD 2.29 billion), up from ₹183.31 billion in the same period last year. The impressive increase was primarily due to the divestment of a 13.2% stake in Yes Bank to Japan’s Sumitomo Mitsui Banking Corporation for ₹88.89 billion in September. This transaction contributed a one-time profit of ₹45.93 billion, significantly boosting the bank’s quarterly earnings.
Beyond this exceptional gain, SBI demonstrated improvement in its core banking operations. Its net interest income (NII) rose by 3.3% year-on-year to ₹429.84 billion, surpassing market estimates of ₹419.73 billion. The bank’s domestic net interest margin (NIM), a key indicator of profitability, showed sequential improvement, rising to 3.09% up by seven basis points from the previous quarter, though still 18 basis points lower than the year-ago period.
SBI’s loan portfolio continued to expand, reflecting growing credit demand in India’s recovering economy. Gross advances grew by 12.7% year-on-year, supported by strong performance in retail, agriculture, and corporate lending. Meanwhile, total deposits increased by 9.27%, signaling sustained customer trust in the bank’s stability and services.
The lender also recorded progress in asset quality, as its gross non-performing asset (NPA) ratio declined to 1.73%, compared to 1.83% in the previous quarter. This improvement reflects better recovery mechanisms, careful risk management, and a healthier credit portfolio, especially in the retail and SME segments.
Market observers noted that while Indian banks had been under pressure from narrowing margins in the first half of the fiscal year, the September quarter results indicate that this trend might have bottomed out. Analysts believe SBI is now well-positioned to benefit from stable interest rates and increasing loan growth in the coming months.
The strong quarterly results also reflect SBI’s balanced strategy of combining strategic divestments with operational efficiency. The Yes Bank stake sale provided a timely boost to profitability, while the recovery in core earnings suggests a strengthening foundation for sustained growth.
Looking ahead, the bank’s focus will be on maintaining asset quality, managing liquidity, and leveraging digital transformation to expand its retail and corporate customer base. As the Indian economy continues to recover and credit demand rises, SBI’s diversified portfolio and robust balance sheet are expected to play a central role in shaping the next phase of the country’s banking growth story.