Financial Daily from THE HINDU group of publications
Saturday, Apr 29, 2006
Financial Daily from THE HINDU group of publications Saturday, Apr 29, 2006 |
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Money & Banking
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Financial Performance Corporate Results - Public Sector Banks Bank of India Q4 net zooms on higher income Our Bureau
CAUTIOUS ON CREDIT: Mr M. Balachandran, CMD, Bank of India, and Mr P.L. Gairola, ED, announcing the bank's results in Mumbai on Friday. - Shashi Ashiwal
Mumbai , April 28 Bank of India has reported a five-fold rise in its Q4 net profit at Rs 254.42 crore from Rs 52.8 crore in the corresponding quarter of the previous year, driven by an increase in interest income. The total income grew by 17 per cent to Rs 2,326.5 crore, up from Rs 1,978.6 crore in the previous year. Net interest income for the quarter increased by 73 per cent to Rs 837.81 crore while other income dropped by 16 per cent to Rs 324.4 crore. The bank has declared a dividend of 30 per cent. For the entire fiscal, global advances increased to Rs 66,662 crore, up from the Rs 57,117 crore in the previous year. Global deposits grew to Rs 93,932, against Rs 78,821 crore in March 2005. Mr M. Balachandran, Chairman and Managing Director, Bank of India, said the relatively slower growth in advances was due to the fact that the bank was undertaking credit expansion keeping in view appropriate asset liability management and pricing. "Our lending rates will also be appropriately marked up in due course", he said BOI has registered a net profit of Rs 701.4 crore for FY05-06, up by 107 per cent from Rs 340.5 crore in the previous year. The yields on the bank's advances had increased to 7.58 per cent from 7.14 per cent in the March 2005. The cost of deposits, on the other hand, had declined to 2.04 per cent from 2.15 per cent. Mr Balachandran said that the bank had retired Rs 4,300 crore from low yielding advances to medium and long-term advances like SME credit and agriculture credit. Retail credit grew by 36.7 per cent to Rs 14,580 crore with agricultural credit constituting 19.58 per cent of the net bank credit. Net NPA ratio declined to 1.49 per cent from 2.80 per cent. The capital adequacy ratio of the bank was at 10.75 per cent at the end of March 2006. Mr Balachandran said that the bank planned to raise $280-$300 million (Rs 1,260-Rs 1,350 crore) overseas through hybrid instruments for hybrid Tier I and upper Tier II, subject to RBI approval. "We will tap the overseas markets since there is good appetite among foreign investors for such innovative instruments. Since, we have large overseas operations, this would be ideal," he said. "If RBI does not agree then we will look at raising equity from the domestic market. But that would be our last resort,'' he added He said the bank planned a foray into life insurance with a foreign joint venture partner and another local bank. Shares of BOI ended nearly unchanged at Rs 121.30 on BSE.
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