Business Daily from THE HINDU group of publications
Tuesday, May 01, 2007
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Business Daily from THE HINDU group of publications Tuesday, May 01, 2007 ePaper |
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Money & Banking
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Financial Performance Corporate Results - Public Sector Banks Web Extras - Non-Performing Assets Vijaya Bank net zooms 161% to Rs 331 cr Our Bureau
Bangalore April 30 Vijaya Bank has reported a 161 per cent increase in net profit to Rs 331.34 crore for 2006-07. Speaking to newspersons, Mr Prakash P. Mallya, Chairman and Managing Director, said: "The board has proposed a final dividend of 10 per cent though this will be subject to shareholder approval." Inclusive of the interim dividend during the year, the final dividend stands at 20 per cent. Its operating profit for the year stood at Rs 696.02 crore, up from the previous year's Rs 633.01 crore. But for the large provisions of Rs 348.27 crore, the net profit would have been higher, Mr Mallya said. During the year, provisions included Rs 121 crore for NPAs, Rs 102 crore for standard assets as prescribed by the RBI and Rs 126 crore for depreciation of investments.
Advances surge
Profitability was powered by 45 per cent increase in advances to Rs 24,644 crore (Rs 17,062 crore). As a result, gross income rose to Rs 3,097.9 crore (Rs 2,680.79 crore). Interest from advances alone rose to Rs 1,763.71 crore (Rs 1,342.10 crore).
However, the bank was able to contain establishment expenditure. Operating expenditure was restricted to Rs 650.72 crore (Rs 623.54 crore), which helped protect net interest margin at 3.41 per cent.
During the year, the bank made recoveries of Rs 281.11 crore. But gross NPAs rose to Rs 564.31 crore (Rs 540.15 crore).
As a ratio of advances, though, gross NPAs were contained at 2.29 per cent (3.17 per cent).
Besides, the bank's NPA coverage ratio (provisions as a percentage of NPA) was 74.49 per cent (Rs 73.65 per cent).
A major portion of the NPA accretion came from the real estate sector.
Bad loans to this category were over three per cent. To de-risk the asset books, loans to commercial real estate sector have been slowed down, Mr Mallya said.
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