"Net profit declined 27 per cent yearly due to higher provisions for bad loans or non-performing assets (NPAs)," said bank CEO and Managing Director Rakesh Sharma in a statement here.
Sequentially, however, net profit for Q2 is marginally up 3.2 per cent from Rs 252 crore quarter ago.
Operating profit for the quarter under review was 16 per cent up to Rs 2,480 crore from Rs 2,141 crore in like period year ago and flat sequentially from Rs 2,472 crore quarter ago.
Provisions excluding tax shot up 36 per cent annually to Rs 2,157 crore in Q2 from Rs 1,586 crore year ago though dipping 2.1 per cent sequentially from Rs 2,204 crore quarter ago.
Provisioning for NPAs alone increased 25 per cent in Q2 to Rs 1,950 crore from Rs 1,558 crore year ago but declined 14 per cent sequentially from Rs 2,270 crore last quarter.
"The provision coverage ratio has improved to 54.75 per cent from 51.75 per cent last year," said Sharma.
Gross NPAs increased 17.5 per cent annually to Rs 39,164 crore in Q2 from Rs 33,315 crore year ago but 4 per cent sequentially from Rs 37,658 crore quarter ago.
Similarly, net NPAs grew 25 per cent annually to Rs 25,166 crore from Rs 21,887 crore year ago and 3.6 per cent sequentially from Rs 24,301 crore quarter ago.
"In spite of the headwinds in NPA resolution, we could keep the slippages under control and resultantly, the NPA ratios have showed some improvement," said Sharma.
Gross NPA ratio for Q2 was up at 10.51 per cent from 9.81 per cent year ago and lower than 10.56 per cent quarter ago. Net NPA ratio for Q2 was up at 7.02 per cent from 6.69 per cent year but lower than 7.09 per cent quarter ago.
"Our focus on NPA management will continue and we expect the net NPA to decline below 6 per cent by the fiscal year-end," said Sharma.
Total income for Q2 at Rs 11,995 crore is 1.6 per cent less than Rs 12,187 crore in the same period year ago and 2.5 per cent less sequentially from Rs 12,304 crore quarter ago.
Net interest income at Rs 2,783 crore was up 14 per cent, while non-interest income grew 8.7 per cent to Rs 1,936 crore.
Global business reached Rs 8.55 lakh crore, up 5.33 per cent annually, with deposits at Rs 4.96 lakh crore, up 2.5 per cent and net advances at Rs 3.58 lakh crore, up 9.51 per cent.
Net interest margin (domestic) was 2.60 per cent and (global) 2.34 per cent.
"Though our capital adequacy ratio has improved to 12.45 per cent, we expect benefit from the government's recapitalisation programme," added Sharma.
(This story has not been edited by Social News XYZ staff and is auto-generated from a syndicated feed.)
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