Allahabad Bank Q4 net drops on treasury income fall

Allahabad Bank Q4 net drops on treasury income fall

Mumbai: State-run lender Allahabad Bank reported a 15% drop in Jan-March profit, mainly hurt by lower treasury income and expects loans and deposits to grow 25% in FY11, a top official said on Friday.

For the January-March quarter the bank earned a profit of Rs2.25 billion, down from Rs2.64 billion, a year ago.

“Net profit for the quarter was down mainly due to the impact of the treasury income, which stood at Rs610 million during the fourth quarter, compared to Rs2.45 billion in the corresponding period last year," J.P. Dua, chairman and managing director, told reporters.

It earned Rs1.64 billion of profit from core operations during the Jan-March quarter as against Rs200 million last year.

“Our net interest margin during FY10 stood at 2.94% and going ahead, in the current fiscal, we are hopeful of maintaining it at 3%," Dua said.

The banks earned net interest income of Rs7.43 billion during the quarter against Rs5.93 billion a year ago.

Allahabad Bank’s capital adequacy stood at 13.62%.

Net non-performing assets (NPA) stood at 0.66% for the year against 0.72%, a year ago, he added.

Speaking about fund-raising plans, Dua said the bank had requested the central government for Rs10 billion of fund infusion.

“We expect this money to reach us by the end of current fiscal. This apart, we have a headroom of Rs26 billion in Tier I and Tier II capital," he said.

Shares of Allahabad Bank closed down 3.91% at Rs164.65 in a firm Mumbai market.