Higher provisioning sharply dragged the net profit of State Bank of India, the country’s largest lender, by 99 per cent to Rs 20.88 crore for the fourth quarter ended March 31, 2011, against Rs 1,866 crore in the corresponding quarter last financial year. This was the lowest quarterly profit reported by the bank in 12 years. As a result of the dismal performance, the bank’s stocks fell by almost eight per cent to close at Rs 2,413.60 on the Bombay stock Exchange.The bank's provision for bad loans in the quarter rose to Rs 3,264 crore from Rs 2,187 crore a year ago. The bank also had to bear additional provisioning of Rs 500 crore due to the teaser loans. The Reserve Bank of India has raised the standard asset provisioning requirement on teaser loans by 5 times to 2 per cent. Bank’s exposure to teaser loans is about Rs 25,000 crore.
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