MUMBAI, Nov 21: India's largest bank - State Bank of India - has recorded A 9.97 per cent jump in its net profit to Rs 704.70 crore during the first half of fiscal 1997-98. The bank's net profit during the corresponding period was Rs 640.80 crore.

However the bank's operating profit has declined by 20.16 per cent to 1,362.84 crore during the period due to combination of various reasons.The net non-performing assets of the bank during the period has remained the same at 7.3 per cent.

Announcing the half yearly result on Friday, the SBI chairman MS Verma said that despite a lower average yield on advances, low asset growth and fall in the weighted average prime lending rate (PLR) the bank's profit has remained steady.

``Due to softening of interest rates, there has been no requirement for provisioning for investment depreciation during the period. The bank is holding some excess provision, but it will not take this into the balance sheet,'' he said.

Verma said that there was a marginal fall of 5.10 per cent in non-interest income from Rs 1,161.03 crore to 1,102.24 crore on account of lower earnings in foreign exchange operations.

The level of the total credit flow in the first half was Rs 6.3606 crore as against Rs 5.8423 crore in the corresponding period of 1996-97, he said.SBI's net domestic credit including that of the Corporate Account Group branches taken together is pegged at Rs 53,684 crore, recording a decline of 2.43 per cent over March 1997.

``Corporates have shown a preference for commercial paper, non-convertible debentures, preference shares and external commercial borrowing during the period,'' said Verma, adding that the growth of total resources outflow during the period Rs 1,818 crore.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.