Financial Daily from THE HINDU group of publications
Wednesday, Jun 14, 2006
Financial Daily from THE HINDU group of publications Wednesday, Jun 14, 2006 |
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Money & Banking
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Financial Performance Corporate Results - Private Banks IndusInd Bank posts Q4 loss on higher provisioning Our Bureau
SQUEEZE ON MARGINS: Mr Bhaskar Ghose (right), MD & CEO, IndusInd Bank, with Mr S. V. Zaregaonkar, Executive V-P & CFO, at a press conference in Mumbai on Tuesday. - Paul Noronha
Mumbai , June 13 IndusInd Bank posted a net loss of Rs 62.4 crore against a profit of Rs 62.91 crore, in the fourth quarter ended March 2005-06, due to higher provisioning and increase in operating expenses on account of network and staff expansion. The bank had higher provisioning for 2005-06 at Rs 102.45 crore against Rs 49.15 crore last year. The total income also dropped to Rs 360.32 crore for the fourth quarter (Rs 373.03 crore). Total expenditure was Rs 320.27 crore (Rs 260.97 crore). Net interest income for fourth quarter was low at Rs 78.76 crore (Rs 123.15 crore). Capital Adequacy Ratio was 10.54 per cent (11.62 per cent). The percentage of net non-performing assets to total assets was 2.09 per cent (2.71 per cent). The bank had earlier used securitisation of assets as a means of raising resources. However, after the Reserve Bank of India issued guidelines on securitisation, the bank stopped its securitisation programme in September 2005, said Mr Bhaskar Ghose, Managing Director, IndusInd Bank. "This shortfall in interest income has also affected our balance sheet," Mr Ghose said. The total deposits during the year stood at Rs 15,006 crore (Rs 13,114.28 crore) and advances were at Rs 9,310.46 crore (Rs 8,999.75 crore). "The hardening of interest rates also pushed up our cost of funds. We have always taken bulk deposits from institutions and when interest rates go up, corporates bargain for better rates," Mr Ghose said. At present the low-cost deposits form about 11 per cent of deposits. The bank hopes to increase it to 20 per cent this year. The vehicle financing segment showed a 25 per cent growth in disbursements and 72 per cent growth in gross assets as of March 2006. This segment would remain the thrust area for the bank.
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