(Reuters) -State Bank of India, the country’s largest lender, reported a rise in second-quarter profit on Friday, helped by healthy core lending income.
The state-run lender’s net profit rose 28% to 183.31 billion rupees ($2.17 billion) compared with 143.3 billion rupees a year ago.
That exceeded analysts’ expectation of 161.89 billion rupees, as per estimates compiled by LSEG.
State Bank of India’s interest income rose 12.3% to 1.14 trillion rupees.
While demand for loans remains strong, lenders have made higher provisions during the quarter for loans that become non-performing.
State Bank of India’s provisions and contingencies rose sharply to 45.06 billion rupees in the quarter, from 1.15 billion rupees a year ago, while provisions for bad loans doubled to 36.31 billion rupees.
Its gross bad loans as a proportion of total loans stood at 2.13% at the end of September, versus 2.21% at the end of June.
Private sector lenders Kotak Mahindra Bank, IndusInd Bank and RBL Bank also raised their provisions towards bad loans in the second quarter, amid rising credit card and microfinance delinquencies.
($1 = 84.3490 Indian rupees)
(Reporting by Nishit Navin and Siddhi Nayak; Editing by Mrigank Dhaniwala)
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