Deutsche Bank’s India profit almost doubles in FY2015
Deutsche Bank's India net income rose 45% to Rs3,925 in the year ended March
Mumbai: Germany’s largest lender Deutsche Bank AG on Thursday said its India profit almost doubled to ₹ 1,406 crore in the fiscal year ended March from ₹ 729 crore in 2014, riding on earnings increase and cost checks.
The bank, with $2.10 trillion in global assets, earned net income of ₹ 3,925 crore, up 45% from ₹ 2,713 crore in the year ended March 2014. Its cost-to-income ratio, a measure of cost overheads, fell to 35% from 47% in March 2014.
The bank’s total advances increased 25% to ₹ 36,318 crore from ₹ 29,014 crore, while deposits increased 48% to ₹ 38,634 crore from ₹ 26,114 crore.
Net interest income (NII), or the interest earned on loans and that paid for deposits, increased 15% to to ₹ 2,548 crore from ₹ 2,225 crore.
“The bank did well all through in businesses like transaction banking, trading, foreign exchange as we benefited from the positive macroeconomic conditions, especially after the election results last year,” said a senior official of the bank. He declined to be identified because he is not authorized to speak to the media.
The bank earns a bulk of its income from commercial banking (43%) followed by the markets business (33%). Retail banking contributes only 9% of the banks revenue in India. About 85% of the bank’s advances book in India is corporate, the official cited above said. Its deposit includes 46% of current and savings account deposits.
Ravneet Gill, chief executive officer (CEO) of the bank’s Indian operations said the results reflected Deutsche’s “client relationships, high-quality internal talent and rich product diversity”. “Deutsche Bank’s sustained strategic focus on India has played a big role too,” Gill said in a release issued by the bank.
Net non-performing assets (NPA) ratio, a measure of bank’s loan book quality, inched up to 0.13% from 0.09% last year.
“Cost-to-income has come down mainly because our revenues have increased while we have managed to keep costs under check,” the official cited above said. The bank had infused ₹ 550 crore capital in India last fiscal compared with ₹ 1,248 crore infused in the previous year, the official said.
The latest results are much better than the last set of numbers the bank released for the year ended March 2014, when profit fell 29%. In an interview with Mint in November 2014, Gill had said that fiscal year 2014 profit had dropped due to trading volatility and a limited universe of clients to work with. He had, however, hinted at a better fiscal 2015.
“This year has been the best ever in the structured finance space. We have done many more financing transactions this year despite the absence of new capital expenditure by the industry. As credit growth revives, the need for financing will go up significantly leading to further upside for our financing business,” he said in the interview.
The bank’s results come just days after Deutsche’s Indian-origin global CEO Anshu Jain quit effective 30 June amid falling profit, higher costs, legal problems and sagging share price. The bank currently has 17 branches in India.
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First Published:19 Jun 2015, 02:55 AM IST
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