State Bank of India (SBI), the country’s largest public sector bank, delivered a strong financial performance in the third quarter of FY26, reporting steady growth in profit, improved asset quality, and healthy expansion in loan segments. The results reflect stable credit demand, balanced deposit growth, and continued digital adoption across banking services.
Strong Profit Growth Driven by Higher Lending Activity
SBI posted a standalone net profit of ₹21,028 crore in Q3 FY26, registering a 24% year-on-year growth. This marks the highest quarterly profit recorded by the bank so far. The growth was supported mainly by consistent loan expansion and better operational efficiency.
The bank’s operating profit, which is calculated before provisions and contingencies, rose sharply by 40% year-on-year to ₹32,862 crore. This indicates stronger core business performance and better cost management during the quarter.
Net Interest Income Shows Stable Expansion
Net Interest Income (NII), a key indicator of a bank’s earning strength from lending activities, increased 9% year-on-year to ₹45,190 crore. The improvement highlights steady credit demand across multiple lending segments.
SBI reported a Net Interest Margin (NIM) of 2.99% for Q3 FY26, while domestic NIM stood at 3.12%. For the nine-month period ending December 2025, domestic NIM remained stable at 3.08%, reflecting balanced asset pricing and deposit cost management despite evolving interest rate conditions.
Asset Quality Continues to Improve
The bank showed further progress in controlling bad loans, which remains a critical indicator of financial stability. SBI’s Gross Non-Performing Asset (GNPA) ratio declined to 1.57%, improving by 50 basis points compared to the same period last year. Meanwhile, the Net NPA ratio dropped to 0.39%, reflecting improved recovery and monitoring processes.
The Provision Coverage Ratio (PCR), including AUCA, stood at 92.37%, while PCR excluding AUCA was reported at 75.54%. The slippage ratio remained contained at 0.40%, and the credit cost stayed low at 0.29%, highlighting strong risk management practices.
Loan Book Growth Remains Broad-Based
SBI’s total business crossed ₹103 lakh crore during the quarter, demonstrating steady expansion across deposits and advances. Total deposits exceeded ₹57 lakh crore, while advances crossed ₹46 lakh crore.
Overall advances grew 15% year-on-year, supported by consistent growth in domestic lending. Retail loans increased by 16%, with strong demand across home loans, personal loans, and other consumer financing segments.
SME lending recorded sharp growth of 21%, indicating improved business confidence among small and medium enterprises. Agricultural advances rose 16%, reflecting sustained rural credit demand. Corporate lending also showed stable growth of 13%, signalling gradual improvement in industrial credit requirements.
Deposits and CASA Ratio Maintain Stability
On the liabilities side, deposits grew 9% year-on-year, maintaining a balanced growth trajectory. CASA (Current Account Savings Account) deposits also increased by 9%, with the CASA ratio standing at 39.13% as of December 2025.
Retail term deposits grew 14%, showing stable customer participation in fixed deposit products. The balanced deposit mix continues to support SBI’s lending growth and margin stability.
Capital Position and Digital Banking Strengthen Outlook
SBI maintained a comfortable capital adequacy ratio of 14.04%, while the CET-1 ratio stood at 10.99%, ensuring sufficient capital buffer for future expansion and regulatory requirements.
Digital banking adoption remained a major growth driver. More than 68% of savings accounts were opened through the YONO platform during the quarter. Additionally, alternate digital channels accounted for nearly 98.6% of total transactions during the nine-month period, highlighting the bank’s growing digital ecosystem.
Outlook
SBI’s Q3 FY26 performance reflects stable credit growth, strong risk control, and consistent operational strength. With healthy expansion across retail, SME, agriculture, and corporate lending segments, along with improving asset quality and strong digital penetration, the bank remains well-positioned for sustained growth in the coming quarters.