SBI Card Q2 profit jumps 75% to Rs 778 crore as bad loans decline

New Delhi: SBI Cards and Payment Services Ltd (SBI Card) on Friday reported a 75 percent year-on-year surge in net profit to Rs 778 crore for the September quarter of FY27, largely driven by a sharp reduction in bad loans and impairment expenses.

The credit card company, promoted by State Bank of India (SBI), had posted a net profit of Rs 445 crore in the corresponding quarter of the previous financial year.

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Despite the substantial jump in profitability, SBI Card’s total income grew by a modest 3.2 percent to Rs 5,302 crore during the quarter, compared with Rs 5,136 crore a year earlier, according to its regulatory filing.

Interest income stood at Rs 2,511 crore, while income from other sources reached Rs 2,630 crore.

Lower credit losses boost profitability

A significant improvement in asset quality emerged as the key driver of SBI Card’s earnings growth.

Gross non-performing assets (NPAs) declined to 1.90 percent of gross advances as of September 30, 2026, compared with 2.85 percent a year earlier.

Net NPAs also improved, falling to 0.77 percent from 1.29 percent during the same period.

Reflecting the improvement, impairment losses and bad debt expenses dropped 37 percent to Rs 819 crore from Rs 1,293 crore in the year-ago quarter.

The Rs 474 crore reduction in credit-related expenses was substantial compared with the company’s Rs 333 crore increase in net profit, highlighting the important role played by lower credit losses in boosting earnings.

Capital adequacy strengthens

SBI Card also reported an improvement in its capital adequacy ratio, which rose to 26.5 percent at the end of September 2026 from 22.5 percent a year earlier.

The stronger capital position provides the company with a larger buffer against potential credit risks and supports future business expansion.

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While the quarterly results indicate a notable recovery in asset quality and profitability, the relatively subdued growth in total income suggests that the earnings improvement was driven more by lower credit costs than by a significant acceleration in revenue.

Going forward, sustaining profitability will depend on SBI Card’s ability to expand its credit card business, maintain asset quality and generate stronger income growth without a renewed rise in delinquencies.

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