State Bank of Hyderabad (SBH) on Wednesday reported a year-on-year decline of 21 per cent in net profit for the fourth quarter of FY2012-13, mainly because of higher provisioning for bad assets.

SBH said that higher provisioning for bad assets dragged its net profit down to Rs 380 crore in the three months ended March 31, 2013, from Rs 481 crore in the corresponding period of the previous year.

For the full fiscal year of 2012-13, the bank's net profit slipped 3.7 per cent to Rs 1,250 crore, as against Rs 1,298 crore in the previous fiscal.

Net interest margin jumped 16.5 per cent to Rs 3,918 crore; while net interest income slipped 4.7 per cent from Rs 1,052.6 crore to Rs 1,003 crore.

The banks hiked the provisioning coverage ratio from 62.4 per cent to 65 per cent, which caused net profit to slip from Rs 1,298.27 crore to slightly over Rs 1,250 crore. The loan disbursement for the full fiscal jumped
15.9 per cent to settle at Rs 82,452 crore.

M Bhagavantha Rao, Managing Director of SBH, said that also warned that net interest margin might come down in the current fiscal.

Speaking on the topic, Rao said, "The outlook for the current year considering the interest rate cut announced and MSME advances rates, which were brought down, net interest margin may come down."

For the current fiscal, SBH expects its net interest margin to be around 3 per cent.