State Bank of India posted a higher profit, bolstered by interest income and a sale in its insurance unit while reducing its forecast for new loans amid the pandemic that’s still racing through the nation. Although the bank has covered more than 86 per cent of its existing bad loans, it will be cautious on boosting credit as the virus-led uncertainty continues to hurt the economy, bank’s chairman Rajnish Kumar said at a briefing on Friday. India’s biggest lender cut its loan-growth target to 8 per cent from 10 per cent for the year started April 1. “Any lender who doesn’t take risk is not a lender,” Mr Kumar said. “But we will do so with eyes and ears open.” SBI, which owns almost a quarter of India’s loan market, has a key role in the revival of an economy that probably shrank the most on record in the period. Cash-strapped companies are reeling following a harsh lockdown that has also left millions jobless. SBI’s shares rose 2.6 per cent in Mumbai after it reported net income climbed 81 per cent from a year earlier to $560 million in the three months ended June 30. Its gross bad-loan ratio dropped to 5.44 per cent at the end of June from 6.15 per cent three months earlier. The bank’s loan book under moratorium - a repayment freeze allowed by the regulator until August-end - was $1.7 billion or 9.5 per cent of total advances at the end of June. “There is no suppression of bad loans due to the moratorium,” Mr Kumar said. However, the bank estimates as much as $8.4bn of debt may tip into the non-performing category in this financial year compared with $6.6bn a year ago. SBI has already turned cautious on loan growth to protect its asset quality. The Mumbai-based lender has the largest outstanding amount of non-performing loans in the country, partly due to the sheer size of its balance sheet. It has been focusing on relatively safer credit to individuals while slowing growth in its corporate book.