SBI MD told Reuters, "We believe 9% to 10% (deposit growth) is definitely possible for us, it is a sustainable growth rate, though we have an internal target of 11% to 12%."
Apart from scaling up efforts to record more domestic deposits, the MD stated that the bank also seeks foreign deposits more aggressively.
He believes the foreign currency deposits of non-resident Indians in domestic banks still need improvement even after banks have increased interest rates.
Currently, in dollars, SBI offers a 3.50% rate on FNCR deposits on tenures like 1-year and above 1-year to less than 2-years. Meanwhile, the rate is 3% on 2 years to less than 3 years tenure, 3.10% on 3 years to less than 4 years tenure, 3.15% on 4 years to less than 5 years, and lastly 3.25% on 5 years tenure.
Setty thinks the banking sector has to still witness more momentum in these FCNR flows.
As of June 30, 2022, SBI reported total deposits of ₹40,45,696 crore rising by 8.73% from ₹37,20,987 crore recorded in Q1FY22. The bank's CASA and term deposits rose by 6.54% and 9.34% year-on-year in the quarter. CARA ratio, however, contracted to 45.33% in Q1FY23 versus 45.97% in Q1FY22.
Further, the MD told Reuters, "we are witnessing capacity utilisation going up in many industries and working capital utilisation is also going up which shows that growth momentum will continue."
Also, SBI plans to boost its fee-based income from its overseas operations. Setty told the news agency, "we would like to now focus on how we can increase our fee-based income, whether we can take larger participations and also be part of the club deals and be part of the origination and then distribute later."
Further, Setty pointed out that SBI is watchful of the volatile global economic scenario and may review its growth strategy for international operations as the situation evolves.
In Q1FY23, SBI's asset quality improved with gross NPA at 3.91% versus 5.32% in Q1FY22, while net NPA also bettered to 1% against 1.77% in Q1FY22. The slippage ratio of the bank further improved to 1.38% in Q1 of this fiscal compared to 2.47% in Q1 of FY22.
On BSE, SBI shares closed at ₹561.60 apiece down by 1.84%. The bank's market cap is over ₹5.01 lakh crore.
