The SBI followed its state-run peers Punjab National Bank, Canara Bank and Bank of India in posting weak profits amid high defaults by corporates battling reduced cash flows, high inflation and delays in government approvals for projects.

The country’s largest lender, SBI, said on Friday that net profit fell more than a third to 22.34 billion rupees in the quarter ended December, lagging analysts' estimate of 25.3 billion rupees.

Non-performing loans as a percentage of total assets rose to 5.7 percent from 5.6 percent in the preceding quarter.

Last month, India's top private sector lender ICICI Bank warned that corporate defaults would rise in the coming quarters as borrowers succumb to the pressure of a sluggish economy. ICICI posted its slowest profit growth in four years in the December quarter.

SBI shares, valued by the market at about USD 17 billion, were trading down 1.3 percent at 1,485 rupees.


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