The country’s largest lender, State Bank of India (SBI), has registered a four-fold increase in its net profit for the January-March quarter of financial year 2019-20 at Rs 3,581 crore against Rs 838 crore in the corresponding period in the year ago period, notwithstanding that the impact of coronavirus has started impacting businesses since March beginning. The jump, primarily driven by its stake sale in its credit card unit, reflects an increase of 327 per cent.

In its regulatory filing, the bank said that there was one-time gain worth Rs 2,731 crore from the sale of a portion of investment in bank's credit card subsidiary SBI Cards in the fourth quarter of the previous financial year.

The bank registered its highest ever net profit of Rs 14,488 crore for the full financial year 2019-20 against Rs 862 crore in 2018-19. The operating profit jumped to Rs 68,133 crore in 2019-20 from Rs 55,436 crore in 2018-19—an increase of 22.90 per cent.

Many other banks are also gearing up to sell off their non-core assets, in the wake of rising uncertainty.

As acute slowdown has set into the Indian economy due to the corona-induced lockdown, experts have said that there could be a spurt in non-performing assets—assets that do not fetch any returns.

The Reserve Bank of India (RBI) announced a three-month moratorium period on loan repayments after the country went into a nationwide lockdown on March 25. Later the central bank extended the moratorium on equated monthly installments (EMI) till August 31.

Even as the SBI offered the benefits to its customers, over 80 per cent of its borrowers have paid two or more installments, while 92 per cent have paid at least one installment during the period.

Meanwhile a report by rating agency ICRA noted NPAs in banks may rise to 11.3-11.6 per cent by March 2021. “The uncertainty on the asset quality of banks remains high with almost 30-40 per cent of loan book across various banks under moratorium announced by RBI,” ICRA said in a statement..