SBI Q2 Results FY26: Profit Rises 6% YoY to ₹21,504 Crore; Asset Quality Remains Strong
India’s largest public sector lender, State Bank of India (SBI), has reported a 6% year-on-year rise in consolidated net profit to ₹21,504 crore for the second quarter (Q2) of FY26, compared to ₹20,279 crore in the same quarter last year. The steady growth reflects strong loan demand and disciplined cost management despite margin pressures from rising funding costs.
Key Financial Highlights
| Parameter | Q2 FY26 | Q2 FY25 | YoY Growth |
|---|---|---|---|
| Net Profit | ₹21,504 crore | ₹20,279 crore | 6% |
| Total Income | ₹1.23 lakh crore (approx.) | ₹1.15 lakh crore | 7% |
| Net Interest Income (NII) | ₹42,300 crore | ₹41,072 crore | 3% |
| Operating Profit | ₹26,480 crore | ₹24,800 crore | 6.7% |
| Gross NPA Ratio | 2.29% | 2.55% | Improved |
| Net NPA Ratio | 0.57% | 0.64% | Improved |
Key Drivers of Growth
- Healthy loan growth: Robust demand in retail and SME segments boosted advances, with personal loans, housing, and auto segments showing double-digit expansion.
- Strong asset quality: Gross NPAs fell to 2.29%, the lowest in over a decade, reflecting efficient credit management.
- Improved operating efficiency: Cost optimization and digital process automation reduced the cost-to-income ratio.
- Stable treasury and fee income: Non-interest income provided additional stability amid narrowing margins.
Challenges and Concerns
While SBI maintained profitability, analysts highlighted certain risks:
- Net Interest Margin (NIM) pressure: Increased competition and deposit repricing may impact yield.
- Moderate loan growth in corporate segment: Some slowdown due to cautious capex spending.
- High-cost deposits: Continued rise in term deposit rates could weigh on margins in upcoming quarters.
Despite these challenges, SBI’s diversified portfolio and digital transformation have helped sustain overall profitability.
Market Reaction
Following the Q2 announcement, SBI’s shares traded flat to marginally positive, reflecting investor confidence in the bank’s steady fundamentals. Analysts noted that the results were in line with market expectations, reinforcing the bank’s status as a stable PSU performer.
Management Commentary
SBI Chairman Dinesh Kumar Khara highlighted that the bank remains focused on maintaining asset quality while growing profitably:
“Our strategic focus on risk-controlled lending, technological innovation, and customer-centric growth has enabled consistent performance. The bank continues to strengthen its digital ecosystem to enhance efficiency and outreach.”
Outlook for FY26
Looking ahead, SBI aims to:
- Expand credit growth by 12–14% in FY26
- Improve NIM through better asset mix
- Continue reducing NPAs via better recovery mechanisms
- Drive digital transformation and cross-selling opportunities
Experts suggest that with improving credit demand, strong retail traction, and consistent profitability, SBI is well-positioned to sustain growth momentum in the second half of FY26.
Conclusion
SBI’s Q2 FY26 performance reflects resilience, steady profitability, and operational strength amid a competitive environment. With a 6% YoY profit increase to ₹21,504 crore, the bank continues to demonstrate its leadership in India’s banking sector, supported by solid fundamentals, robust digital strategy, and healthy asset quality.
