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BUDGET IMPACT: BANKING SECTOR

Article Abstract:

The Government of India, in its budget for 1999-2000, has recommended setting up of more debt recovery tribunals and a settlement advisory committee. It has allowed tax reduction on amounts provided by banks for their non-performing assets (NPAs), provided it is less than 5 percent of doubtful debts. The Reserve Bank of India has reduced the interest rates and the cash-reserve ratio, which will increase the profitability of the banks. The bank rate has been reduced to 8 percent from 9 percent, the cash- reserve ratio from 11 percent to 10.5 percent and the repo rate from 8 percent to 6 percent. The price of bonds in the secondary markets has increased. This will help the banking sector make more profit. (rk) (kvr)

Taxes

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CORPORATE FORECAST: SBI

Article Abstract:

Research houses expect State Bank of India to maintain its net profit in 1998-99 at around the same levels as the net profit of Rs1842.75 crore in 1997-98. The bank posted a net profit of Rs426.6 crore in the first quarter of 1998-99. Caspain Securities has predicted that the bank will give an earnings per share (EPS) of Rs35.3 in 1998-99 while Goldman Sachs has predicted an EPS of Rs38.9. ICICI Securities has forecast an EPS of 32.7 while SG Securities Asia has predicted an EPS of Rs39.4 for the company in 1998-99. (khr)

Comment:

Research houses expect State Bank of India to maintain its net profit in 1998-99 at around the same levels as the net profit of Rs1842.75 crore in 1997-98.

Sales, profits & dividends, State Bank of India

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