Mumbai: State-run Indian Bank on Tuesday reported a more than threefold jump in profit for the March quarter owing to a low base last year.
Net profit rose to Rs319.7 crore for the three months ended 31 March from Rs93.62 crore in the year earlier. The bank was expected to post a profit of Rs288.8 crore, according to a Bloombergsurvey of five analysts.
Net interest income, or the core income a bank earns by giving loans, increased 22% to Rs1,385 crore from Rs1,134.63 crore a year earlier. Other income stood at Rs585.38 crore, as against Rs538.48 crore a year earlier.
Provisions and contingencies fell marginally to Rs806.91 crore from Rs813.6 crore in the same quarter last year.
The bank’s gross non-performing assets (NPAs) rose 1.9% to Rs9,865.13 crore at the end of the March quarter from Rs9,675.1 crore in the December quarter. On a year-on-year basis, it jumped 11% from Rs8,827.04 crore.
As a percentage of total loans, gross NPAs were at 7.47% at the end of the March quarter, as against 7.69% in the previous quarter and 6.66% in the March 2016 quarter. Net NPAs came in marginally lower at 4.39% in the quarter than 4.76% in the preceding three months, but significantly lower than the March 2016 quarter’s 6.66%.
Capital adequacy ratio stood at 13.64%, more than the 10.25% required according to central bank norms.
“Operating performance is much more stable... Capital raising will help them in further improving capital adequacy ratio and will consolidate its position within PSB (public sector bank) segment in case of any future consolidation by government” said Asutosh Mishra, an analyst with Reliance Securities Ltd.