MUMBAI: State Bank of India (SBI) on Wednesday said it has crossed the Rs 5 trillion-mark in its home loan business.
The real estate and housing business (REHBU) unit of the bank has grown five times in the last 10 years with an asset under management (AUM) of Rs 89,000 crore in 2011 to Rs 5 trillion in 2021.
“This extraordinary feat is a testament to customers’ continuous trust in the bank. We feel that combining technology with personalised service is the key in the current scenario,” the bank’s chairman Dinesh Khara said.
The bank is also working on various digital initiatives to improve the efficiencies in home loan delivery, including a unique integrated platform Retail Loan Management System (RLMS) which will provide an end-to-end digital solution, he added.
The bank is looking at achieving a home loan AUM of Rs 7 trillion by FY 2024.
In the home loan market, the country’s largest lender share is 34 per cent.
The lender forayed into the home loan business in 2004 with a total portfolio of Rs 17,000 crore. A separate REHBU came into being in 2012 with a total portfolio of Rs 1 lakh crore.
SBI plans to double its home loan portfolio to 10 trillion rupees ($137 billion) in the next five year after crossing the 5 trillion mark in January, the bank’s top executive said.
“Home loan is the biggest business unit of the bank now and will continue to be an important growth driver,” SBI Chairman Dinesh Kumar Khara said in a media conference.
The lender’s home loan book has grown by five times in the last decade from 86,000 crore rupees in 2011.
At a time when several other lenders have seen stress in their retail loan portfolios, SBI has dismissed such concerns and emphasised its plans to focus on the sector. The current customer base, with a focus on salaried employees, has managed to keep bad loans in the segment in check, said Khara.
Gross non-performing assets in the home loan division are 0.67% of the total loan book. With greater focus on home loans, the bank is looking to increase its share of retail in the overall loan book to 45% in one year, from 39% currently.
Source: Press Trust of India and Reuters