Positioning SBI in a Competitive Market

As the new chairman of the State Bank of India (SBI), C S Setty is steering the 218-year-old institution towards a future where technology and customer service are paramount. Despite the scale achieved by private banks, SBI continues to adapt and innovate, maintaining its status as India's largest digital bank.

Enhancing Channels and Managing Scale

With plans to hire 13,000 clerical staff, SBI is focusing on strengthening its channels, including its extensive network of employees dedicated to home and auto loan procurement. This strategy underscores the bank's commitment to blending manpower with technology to manage its expanding scale.

Economic Outlook and Budget Expectations

Setty views the recent economic slowdown as seasonal rather than structural, with a positive outlook for the next quarter. He emphasizes the need for the upcoming Budget to stimulate economic activity and boost private capital expenditure, suggesting measures like shortening the tenure of tax-free deposits.

Focus on Home Loans and Gold Loans

With a strong asset quality and a focus on first-time homebuyers, SBI remains optimistic about the home loan market. Similarly, the bank's gold loan portfolio, particularly in the agriculture sector, is seen as low-risk, with clear visibility on loan use and repayment.

Addressing Credit Card Defaults and MSME Credit

SBI is tackling credit card defaults by leveraging more frequent credit history updates. The bank is also ready to meet the Budget's call for developing models for MSME credit, with a business rule engine that offers quick in-principle approvals for loans up to Rs 5 crore.

Liquidity and Deposit Strategies

While there's some pressure on liquidity, SBI believes deposit rates have peaked and is exploring innovative products to maintain FD flow and attract salary accounts, ensuring competitiveness in a maturing economy.

Commitment to Project Financing

Despite uncertainties around infrastructure project norms, SBI remains a major player in project financing in India, leveraging its expertise to appraise and support large projects.