Financial Daily from THE HINDU group of publications
Wednesday, Jan 30, 2002
Money & Banking
Corporate Results - Private Banks
GTB net sinks on provisioning
HYDERABAD: Global Trust Bank (GTB) has registered a fall of 12.27 per cent in total income and 74.12 per cent in net profit for the third quarter of current fiscal year ended December 31, 2001.
Though both the operating expenses and total expenditure for the quarter under review were low compared to the corresponding quarter last fiscal, the net profit has fallen largely owing to the sharp rise in provisions and contingencies, which were higher by 296.53 per cent. These provisions and contingencies include provision for non-performing assets (NPAs) and depreciation on investments.
According to the unaudited financial results taken on record by the GTB board on Tuesday, the bank achieved interest earnings of Rs 182.59 crore as against Rs 212.02 crore in the corresponding quarter last year, other income of Rs 60.84 crore (Rs 61.3 crore), taking the total income for the quarter to Rs 243.43 crore (Rs 273.32 crore).
While the operating profit before provisions and contingencies registered a fall of 22.02 per cent at Rs 48.92 crore (Rs 62.74 crore), the bank ended up with a net profit of Rs 8.91 crore as against Rs 34.44 crore in the corresponding quarter last fiscal.
For the quarter under review, GTB incurred an interest expenditure of Rs 154.87 crore (Rs 170.88 crore), operating expenses of Rs 39.64 crore (Rs 39.7 crore), taking the total expenditure to Rs 194.51 crore (Rs 210.58 crore).
The bank provided Rs 39.1 crore towards NPAs and others (Rs 10.09 crore) and Rs 0.91 crore towards depreciation on investments as against no such provision in the corresponding quarter. The bank did not make any provision for taxation during the quarter under review as against Rs 18.21 crore provided in the corresponding quarter.
GTB's capital adequacy ratio stood at 14.68 per cent as on December 31, 2001 as against 12.79 per cent as on December 31, 2000.
For the nine months period ended December 31, 2001, the total income was marginally lower by 2.72 per cent at Rs 740.14 crore (Rs 760.88 crore), while net profit was substantially lower by 70.76 per cent at Rs 30.12 crore (Rs 103.04 crore).
According to the GTB Director, Dr Sailendra Narain, no provision for income-tax was considered for the quarter under review after considering various deductions and allowables under Income-Tax Act, 1961. Further, in accordance with Accounting Standard 22, "Accounting for Taxes on Income'', its deferred tax liability as on April 1, 2001, was adjusted against the revenue reserve. Deferred tax adjustment for the financial year ending March 31, 2002, would be considered at the year-end.
Dr Narain said the status of its capital market exposure, including exposure against shares, were being assessed with reference to security and recovery proceedings. The same would be dealt with adequately by the year-end after the exercise was complete.
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