SBI’s remarkable ascent: MOFSL analysts foresee continued growth; tops global banks with Best-in-Class RoE
At ₹62 lakh crore, the State Bank of India’s balance sheet size is equivalent to 21 per cent of India’s GDP and has surpassed the GDP of 174 countries worldwide, according to Motilal Oswal Financial Services Ltd (MOFSL).
There are only 22 countries (including the US, China, Germany, Japan, India, UK, France, Brazil, Italy and Canada) whose GDP is greater than SBI’s balance sheet size ($742 billion) and some major countries from among 174 countries (including Belgium, Argentina, Thailand, Austria, UAE, Singapore, Hong Kong) whose GDP is less than the balance sheet of the bank.
MOFSL analysts reckon that this gap will only widen as India’s largest bank delivers steady growth.
The bank has demonstrated high agility and superior execution even at this huge size and is well poised to maintain this momentum, they said, adding SBI is well positioned to move up the global rankings.
“SBI’s balance sheet has witnessed a remarkable ascent, scaling to an impressive ₹62 lakh crore in FY24….
“The Bank has outshined its global peers with a best-in-class RoE (return on equity) alongside an impressive CAGR (compounded annual growth rate) in loans over the past few years, demonstrating consistent growth and profitability amid dynamic market conditions,” MOFSL Research Analysts’ Nitin Aggarwal, Dixit Sankharva and Disha Singhal said in a note.
India’s largest bank topped the charts among the top 14 global banks, with a RoE of 18.8 per cent in FY24, followed by JP Morgan Chase & Co (16.9 per cent in Calendar Year/CY23) and China Merchants Bank (16.6 per cent in CY23), per the analysts’.
SBI delivered the fastest loan growth, about 16 per cent CAGR, among the top 14 global banks in the last two years (FY22-FY24), followed by JP Morgan Chase & Co (11 per cent CAGR in CY21-23) and Agricultural Bank of China (9 per cent CAGR in CY21-23).
The bank delivered 44 per cent returns over the past year, ranking second among the 14 large global banks that MOFSL has studied. With 70 per cent one-year returns, Mitsubishi UFJ was at a numero uno position.