The Hindu Business Line : Kotak Mahindra Bank posts Rs 37-cr net profit in Q4

Mumbai May 8 Driven by a strong growth in net interest income, Kotak Mahindra Bank's net profit increased by about 7.5 per cent to Rs 37.3 crore in the fourth quarter ended March 31, 2007, from Rs 34.7 crore in the corresponding year-ago quarter.

The profit growth would have been higher but for higher provisions amounting to Rs 31.7 crore in the fourth quarter.

Operating profit was more than 50 per cent higher at Rs 95.9 crore (Rs 62 crore).

The net interest income increased to Rs 204.7 crore (Rs 116.9 crore) while other income rose to Rs 87.5 crore (Rs 76.5 crore). Net interest margin for the quarter was around 4.5 per cent. Total income increased to Rs 521.07 crore (Rs 293.45 crore).

Full year net

For the fiscal ended March 2007, net profit for the year was up 20 per cent to Rs 141.4 crore (Rs 118.2 crore).

The bank's board has recommended a dividend of 7 per cent for 2006-07.

"This growth is after considering a Rs 28-crore provision on stressed assets portfolio acquired from other banks or NBFCs, an additional standard provision of Rs 44.8 crore consequent to the change in RBI guidelines, and a provision of Rs 6.8 crore on account of liability for employee benefits in accordance with AS 15," said Mr Uday Kotak, Executive Vice-Chairman and Managing Director, Kotak Mahindra Bank, at a news conference on Tuesday.

Operating profit amounted to Rs 326 crore (Rs 211 crore), registering a 55 per cent growth.

Net interest income for the year amounted to Rs 654.9 crore (Rs 380 crore).

The total advances of the bank grew by 72 per cent to Rs 10,924.0 crore as on March 31, 2007 from Rs 6,348.5 crore as on March 31, 2006.

Loan segment

Its home loans and personal loans segment grew by 81 per cent and 94 per cent, respectively.

"We would like to control our NPA ratio, maintain good net interest margin and still keep our advances growing," said Mr Kotak.

As on March 31, 2007, the bank's deposits grew 56 per cent to Rs 10,251.4 crore (excluding temporary deposits held as collection bankers to IPOs of Rs 748.7 crore).

Deposit growth

The bank's current and savings account (CASA) deposits grew by 82 per cent to Rs 2,248 crore and now comprise 22 per cent of total deposits. Capital adequacy ratio was at 13.46 per cent. For 2006-07, Kotak Mahindra Bank's consolidated net profit was up 57 per cent, at Rs 538.2 crore.

The bank's scrip closed at Rs 540 on Tuesday, against the previous close of Rs 547.95 on the BSE.

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