The Hindu Business Line : J&K Bank posts 33.4% growth in net profit

New Delhi, July 27 J&K Bank on Friday reported a 33.44 per cent increase in net profit for the quarter ended June 30 to Rs 83.24 crore compared with Rs 62.38 crore recorded in the same period last year.

Interest earned for the quarter under review stood at Rs 575.05 crore as against Rs 454.65 crore in the same period last year.

“The 33 per cent growth in net profit in the first quarter has been driven by a 32 per cent increase in advances and about 113 basis points increase in yield on advances from 9.1 per cent to 10.23 per cent,” Dr Haseeb Drabu, Chairman of J&K Bank, told Business Line.

The bank’s operating profit rose 12 per cent to Rs 131.18 crore (Rs 117.48 crore). While total deposits stood at Rs 24,744 crore as on June 30, registering a 20 per increase, the advances grew 32 per cent year-on-year to touch Rs 17,351 crore as June 30, 2007.

Net non-performing assets of the bank stood at Rs 169.31 crore as on June 30, 2007, lower than the Rs 193.57 crore level as on March 31, 2007, but much higher than the net NPA level of Rs 94.48 crore as on June 30, 2006.

The net interest margin saw a drop to 2.9 per cent for the period under review compared with 2.93 per cent in the same quarter last year. Cost of deposits increased to 5.93 per cent from 4.89 per cent.

On capital raising plans, Dr Drabu said that the bank plans to go in for a Global Depository Receipts issue by the end of second quarter or beginning of third quarter.

He also said that the bank would in the next 3-4 months examine whether Tier-II capital need to be raised.

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