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SBI Chairman C S Setty said the bank's mortgage loan portfolio crossed INR 9 lakh crore last month, reflecting sustained demand in the retail segment. He noted that Retail, Agriculture and MSME loans now form 67% of the bank's total portfolio and had crossed INR 25 lakh crore in September. With economic activity improving, SBI has raised its overall credit growth target for the year from 12% to 14%. Setty also pointed to steady growth in gold loans, personal loans and a revival in corporate credit, supported by the Reserve Bank of India's recent repo rate reduction.
State Bank of India's mortgage loan portfolio crossed INR 9 lakh crore last month, marking a significant expansion in its retail lending business. Chairman C S Setty said the bank expects the strong momentum in the Retail, Agriculture and MSME (RAM) segment to support its revised overall credit growth target of 14% for the current financial year. The RAM segment, which accounts for about 67% of SBI's total loan book, surpassed the INR 25 lakh crore level in September, reflecting broad-based demand across categories. Advertisement
He explained that the bank raised its credit growth guidance from the earlier estimate of 12% after noticing a sustained pick-up in economic activity. Setty said the MSME portfolio has been expanding at about 17-18%, while agriculture and retail loans are growing at roughly 14%. He also highlighted that gold loans are performing well and that unsecured express credit is set to continue in double-digit growth.
Corporate lending, which had remained subdued for a while, has begun showing improvement. The segment grew by 7.1% in the second quarter, encouraging the bank to project lower double-digit growth for the remainder of the year. Setty said the overall 12-14% credit growth target appears achievable with the current performance trends.
He noted that the Reserve Bank of India's recent decision to reduce the repo rate by 25 basis points to 5.25% is expected to make borrowing cheaper and stimulate demand for fresh credit. The rate cut, announced last week after a six-month gap, came at a time when economic growth touched a six-quarter high of 8.2% in the second quarter of FY26.
Despite the policy rate reduction, Setty expressed confidence that SBI would maintain its net interest margin at the guided level of 3%. He also indicated that the bank is unlikely to need additional equity capital in the near term. SBI recently completed a Qualified Institutional Placement (QIP), but Setty said the bank's ability to support credit growth was not dependent on this raising, as its capital position was already strong.
He added that the bank aims to maintain a Capital to Risk Asset Ratio (CRAR) of 15% and a Common Equity Tier-1 (CET-1) ratio of 12% over the next five to six years. According to him, this capital strength provides room to support advances of more than INR 12 lakh crore. Setty stated that if SBI continues to deliver profitability at current levels over the coming years, it may not require fresh capital infusion for CET-1.
Source PTI
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