SBI posted its third quarter consolidated result on 10th Feb 2017 where bank’s net profit registered a growth of 70% in comparison to last year same quarter result. In standalone company registered a growth of 134.01%. However, Bank’s Net NPA increased by 46.71% and Gross NPA jumped by 41.76% YoY.
Similarly, most of the PSU Banks has posted higher NPA’s in third quarter, which is signaling poor asset quality in Banks. Demonetization might have created a positive impact for banks as the money supply has gone up in the banking system. Pressure on banking segment with regards to asset quality is still a big question mark.
PSU Bank has an average Net NPA of 7.98%, IOB has NPA of 14.32%, Bank of Maharashtra has net NPA of 10.67% and United Bank Net NPA is 10.62%.
Overall Health of Psu Banks Post Q3 Result
In the above table SBI, Vijaya Bank and Indian Bank has shown good jump in Net interest margin and their Net Profit percentage has also shown a good jump in all three banks.
Overall Health of Private sector Banks after Q3 Result
Private Banks has an average 2.03% Net NPA, Yes Bank has lowest NPA of 0.29% and has registered a growth in net profit by 31%. HDFC Bank is a second best Private Bank with 0.32% Net NPA and Net profit growth of 15%. IndusInd Bank and DCB Bank have also shown good performance in their third Quarter result.
Results of both PSU and Private Banks suggest that PSU banks are still struggling with bad asset quality and impact of the same is seen on their performance.
Vijaya Bank, Indian Bank, SBI Bank, Yes Bank, HDFC Bank, DCB bank and IndusInd Bank are good banks to make an investment in, in the short term.
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