Specialist in Indian Banking and Economic Research

Hemindra Hazari

Is a Securities & Exchange Board of India (SEBI) registered research analyst with over 25 years experience in the Indian capital markets with a specialization in banking and economy research and has managerial experience of establishing profitable equities business, leading and mentoring analysts.  He has worked with prominent foreign and domestic capital market firms such as UBS, Societe Generale, HSBC, ASK Raymond James  and Karvy Stock  Broking and is a regular guest on business media channels and is respected for his non-consensus view on stocks and the market.

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<p>State Bank of India (SBI), the nation’s largest and the government’s premier bank, reported a consolidated 4Q loss of Rs30bn and an annual profit of only Rs2.4bn as compared with a Bloomberg full-year consensus estimate of Rs69bn. Worse, in the elaborate press and analysts’ presentation, there is no mention nor any explanation provided for this unexpected loss which has arisen on account of the bank’s five banking subsidiaries which were merged from April 1, 2017. The lack of transparency is compounded with the issue of corporate governance and accountability as these subsidiaries were under the direct managerial control of SBI and their deterioration in financial performance is a reflection on SBI’s senior management. It is now apparent that the merger of the bank subsidiaries was not a grand design in bank consolidation in India but to bail-out the poorly managed banks.  Digesting these huge losses will add to the operational problems of integrating these banks within SBI and dark days may lie ahead for the banking behemoth.</p>

State Bank of India (SBI), the nation’s largest and the government’s premier bank, reported a consolidated 4Q loss of Rs30bn and an annual profit of only Rs2.4bn as compared with a Bloomberg full-year consensus estimate of Rs69bn. Worse, in the elaborate press and analysts’ presentation, there is no mention nor any explanation provided for this unexpected loss which has arisen on account of the bank’s five banking subsidiaries which were merged from April 1, 2017. The lack of transparency is compounded with the issue of corporate governance and accountability as these subsidiaries were under the direct managerial control of SBI and their deterioration in financial performance is a reflection on SBI’s senior management. It is now apparent that the merger of the bank subsidiaries was not a grand design in bank consolidation in India but to bail-out the poorly managed banks.  Digesting these huge losses will add to the operational problems of integrating these banks within SBI and dark days may lie ahead for the banking behemoth.

SBI – Huge 4QFY2017 Losses, Dark Days Ahead

State Bank Of India

SBI – Huge 4QFY2017 Losses, Dark Days Ahead