State Bank of India

Good evening, ladies and gentlemen. I am Pawan Kumar, General Manager, Performance Planning and Review Department of the Bank. On behalf of the State Bank of India, I am delighted to welcome the analysts, investors, colleagues and everyone present here today on the occasion of the declaration of the quarter two financial year 26 results of the bank. I also extend a very warm welcome to all the people who are assessing the event through our live webcast. We have with us on the stage our Chairman Sir, Sri C.S. Shetty at the centre. Our Managing Director, Corporate Banking and Subsidiaries, Sri Aishwani Kumar Tiwari. Our Managing Director, Retail Banking and Operations, Sri Vinayam Tonsai. Our Managing Director, Risk Compliance and Saji, Sri Rana Ashutosh Kumar Singh. Our Managing Director, International Banking, Global Markets and Technology, Sri Ram Mohan Rao Amara. Our Deputy Managing Director, Finance, Srimati Saloni Narayan. Our Deputy Managing Directors heading various verticals and Managing Directors of our subsidiaries are seated in the front rows of this hall. We are also joined by Chief General Managers of different verticals, business groups. To carry forward the proceedings, I request our Chairman Sir to give a summary of the Bank's Q2 financial year 26 performance and the strategic initiatives undertaken. We shall thereafter straight away go to question and answer session. However, before I hand over to Chairman sir, I would like to read out the safe hour statement. Certain statements in today's presentation may be forward-looking statements. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. Actual outcomes may differ materially from those included in these statements due to a variety of factors. Thank you. Now I would request Chairman sir to make his opening remarks. Chairman sir please.

Thank you Pavan. Good evening ladies and gentlemen. Thanks for your interest in SBI. I would like to start by thanking the support of all our stakeholders including our customers, shareholders, employees and the broader ecosystem for supporting us all through our journey. Fairness to all our stakeholders remains at the crux of the bank's culture, which in turn has helped us in creating sustainable value and contributing to nation's success. Let me first start with a brief description of the present global and domestic economic scenario. The Global Economic Outlook for 2025 presents a picture of modest but uneven recovery. The IMF's World Economic Outlook October 2025 projects world GDP growth at 3.2% in 2025 and 3.1% in 2026, reflecting steady but subdued momentum amid persistent structural challenges. Regarding inflation, though it has broadly moderated across most economies, the pace of disinflation remains slow. Against this global backdrop, India's macroeconomic outlook remains one of cautious optimism, underpinned by robust domestic demand and easing inflationary pressures. The RBI projects real GDP growth at around 6.8% for FY26 and 6.6% for FY27. Growth is being supported by strong investment activity, recovery in rural consumption and buoyancy in services and manufacturing. The GST 2.0 reforms are expected to boost private consumption and domestic demand. On banking front, scheduled commercial banks' credit growth is slowly picking up and grew by 11.5% year-on-year. Last year, it was at the same level of 11.5%, but the fortnight ended 17 October 2025, while deposit growth remains sluggish at 9.5%, which was 11.7% last year. Going forward, we expect demand for credit to continue in the second half. By looking at the trend, deposits and credit growth of scheduled commercial banks may remain in the range of 11-12% during FY26. However, risks persist from volatile global commodity markets and potential spillovers from the trade disruptions. Overall, India's near-term outlook is strong, with macroeconomic stability providing space for sustained medium-term growth. In the above economic backdrop, let me now highlight a few key aspects of banks' performance in the half year and second quarter of FI26. Our Q2 FI26 results and of several quarters before this, underscore a simple point. State Bank of India is compounding on durable structural advantages, scale with discipline, Growth with quality returns with resilience. The current quarter demonstrates industry-leading credit growth at SBI scale, market share gains in chosen segments such as current account, home loans, auto loans, stable asset quality and disciplined pricing. Our domestic NIMS for the quarter improved by seven basis point quarter on quarter to 3.09%, driven by repricing of deposits. operating leverage from technology, distribution, and procurement. The flywheel is clear. Our strength in low-cost liability is derived from our brand, customers' trust in SBI, and our extensive reach. These advantages allow us to expand liabilities significantly, which are then utilized to finance strategic growth with careful pricing discipline. This focus on pricing and robust risk management supports our leading written-on risk-weighted assets, Rorva. A well-capitalized balance sheet enables us to achieve top-tier written-on equity, which in turn helps in compounding our book value while maintaining stable capital ratios. In this quarter, we also raised 25,000 crores of equity capital by way of qualified institutional placement with a demand book of more than 1.1 trillion rupees. This was the largest ever QIP offering in India. We thank our investors for supporting us in the capital raise. The issue was oversubscribed for and of times with significant interest from both domestic and foreign institutional investors. What are our strategic anchors? They are brand trust and customer value. SBI is the reference brand in Indian banking. We earn trust by creating value for customers through transparent, efficient service and optimal pricing across deposits and lending. Relationship depth drives balance stability and lowers risk through cycles. Institutionalization at scale. SBI runs on codified processes in credit, risk, collections, treasury, technology and procurement while allowing innovation at all levels. Execution is consistent and repeatable across businesses and regions. Fair outcomes for all stakeholders is the third anchor. We balance customers, employees, investors and society. Capital is allocated where risk-adjusted returns are sound. We price risk fairly, invest in people and systems and support the real economy while protecting depositors and shareholders. Fourth anchor is liability franchise strength. I think I mentioned earlier also, our total deposits of 56 lakh crore, CASA deposits of more than 21 lakh crore with CASA ratio at 39.63%, while CASA market share 23% versus overall deposit market share of more than 22%. This granular, low-cost funding is a structural advantage and the engine for disciplined growth. And finally, the anchor which I want to mention is leadership where Roorba is attractive. We lead by a wide margin in lending and liability products with superior risk-weighted returns. We choose segments where unit economics are strong and prices up are de-emphasized where capital is not adequately compensated. We believe SBI is positioned to grow faster than the industry at this scale and to deliver higher ROE than the industry. We will attempt to deepen the liability engine and sustain the Kasa outperformance, allocate capital to high Rorwa businesses and maintain pricing discipline, use technology to lower cost to serve and lift service quality and further improve capital turns. Keeping in view a customer-centric approach, Bank has launched Project Surrell, I think I did mention last time also, on the 31st July 2025, aligning with this year of simplification, an ambitious vision of a complete revamp and redesign of operational processes in our retail banking territory. The aim is not only to re-engineer the existing processes, but also to make the bank future ready for the evolving financial landscape and changing market dynamics. So as we augment and enhance our digital capabilities further, bank will shortly launch the next version of Yono platform, Yono 2.0, which is not just an upgrade to the previous version, but a leap forward in digital banking. with state-of-the-art journey designs and supporting tech architecture, our customers can bank with confidence and in a more seamless manner. Although the current valuations of SBI are a conundrum, considering our return on equity and growth metrics, we are confident that they will eventually align with our fundamental and operational metrics, the institutionalized nature of our business, and our market leadership in the coming years. SBI's path is clear. We will defend and extend the liability franchise, grow faster than industry where Rorwa is superior, institutionalize execution and deliver fair outcomes for all stakeholders. To conclude, I thank you all for your continuous support to the Bank. We remain committed to rewarding your trust in us with sustainable returns over the long term. I wish everyone here the best of health and happiness. My team and I are now open to taking your questions. Thank you very much.

Thank you, Chairman Sir. We now invite questions from the audience. For the benefit of all, we request you to kindly mention your name and company before asking the questions. Commit all the questions. We request you to restrict your questions to maximum two at a time. Also kindly restrict your questions to the financial results only and no question be asked about specific accounts please. In case you have additional questions the same can be asked at the end. We now proceed with the question and answer session. Please.