State Bank of India Profit Rises on Bad-Loan Provision Clawback - Bloomberg

State Bank of India Profit Rises on Bad-Loan Provision Clawback - Bloomberg:

State Bank of India posted a rise in quarterly profit as the country’s largest lender wrote back provisions on its bad loans.

Net income rose to 55.8 billion rupees ($782 million) in the three months ended December from 39.6 billion rupees a year earlier, broadly in line with the 58.7 billion rupee average of analysts’ estimates compiled by Bloomberg.

SBI has been helped by the resolution of some large bad loan accounts, such as Essar Steel India Ltd., allowing the bank to write back provisions. The lender contributes about a quarter of total Indian bank loans, and its success in reining soured credit could be offset by the nation’s slowing economy.

India’s insolvency regime was bolstered last year by a Supreme Court ruling that paved the way for ArcelorMittal’s $5.9 billion takeover of Essar Steel and empowered banks to set the terms of the distribution of sale proceeds among Essar’s creditors.