BackDCB Bank Q1 profit up 5% to Rs45 crore
The bank's profit was hit by higher operating expenses and provisions
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Mumbai: Private sector DCB Bank Ltd. on Monday said net profit in April-June increased just 5% to Rs45 crore from Rs43 crore in the corresponding period of 2013. The profit was lower than Rs46 crore forecast in a Bloomberg poll of three analysts.
The profit was helped by one-off interest income of Rs30 crore pertaining to tax refunds of previous years, the bank said in an emailed statement.
The bank was hit by higher operating expenses, including employee costs, and also higher provision as the bank chose to make a Rs10 crore additional provision during the quarter.
Total expenses of the bank increased to Rs305 crore in April-June 2014 from Rs255 crore in April-June 2013; provisions increased to Rs23 crore from just Rs9 crore last year.
Net non-performing assets (NPAs) increased slightly to 0.97% of net advances from 0.84% of net advances a year earlier.
“Increase in branch network is putting some pressure on cost to income ratio. NPAs (non-performing assets) remain in control; however, a few accounts in SME (small and medium enterprises) and mid-corporate continue to have payment delays. We have a few challenges in stepping up fee income and we are hopeful of improving the same in 6 to 9 months," Murli Natrajan, managing director and chief executive officer, said in the statement.
Shares of DCB Bank gained 1.92% to close at Rs77.15 on Monday on the BSE, while the benchmark index, Sensex, lost 0.07% to close at 25,006.98 points and the banking index, Bankex, gained 0.3% to close at 16,595.64 points.
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