Business Daily from THE HINDU group of publications
Tuesday, Jul 15, 2008
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Business Daily from THE HINDU group of publications Tuesday, Jul 15, 2008 ePaper | Mobile/PDA Version | Audio |
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Banking Money & Banking - Financial Performance Corporate Results - Private Banks Higher income lifts Axis Bank Q1 net 89% 
Our Bureau
Hyderabad, July 14 Axis Bank’s net profit increased 88.6 per cent at Rs 330.14 crore in the first quarter ended June 30, 2008 compared with Rs 175 crore in the corresponding quarter of previous fiscal year. The total business grew by 44 per cent to Rs 1, 13,660 crore. ``The growth in net interest income and fee-based income drove growth in operating profits. This helped us to buffer the depreciation in our investment portfolio and we were able to ride the storm,” Dr P J Nayak, Chairman and Managing Director, Axis Bank, told Business Line over phone from Mumbai. The bank made a provision of Rs 225.20 crore on the depreciation of bank’s investment portfolio on account of weakening financial markets for the second quarter. ``We may have to continue the provisioning in the subsequent quarters, but we will take a call depending on market conditions,” he said The bank’s investment portfolio had grown by 34 per cent to Rs 35,718 crore in the quarter under review. A strong growth in advances and investments, together with a higher share of demand deposits pushed up net interest income (NIM) by 93 per cent to Rs 810.46 core. The growth in retail and corporate banking led to 80-per cent growth in the fee income at Rs 483 crore. While the YoY results were impressive, the margins were lower on QoQ basis. The rising cost of funds and slower growth of demand deposits during the quarter adversely impacted the NIM which dipped to 3.35 per cent from 3.93 in fourth quarter of last fiscal year. Similarly, the daily average cost of funds too increased to 6.11 per cent (5.82 per cent). Can this be seen as a trouble in the offing in the year ahead? “Not necessarily. Our own feeling is that our margins at the current level are very sustainable,” Dr Nayak said. On the continuation of growth in profits and business in the subsequent quarters, Dr Nayak said, “I don’t know”. However, the bank’s plan to significantly expand its braches this year would bring more business, he added. 
Axis Bank had applied to the Reserve Bank of India for opening 200 new branches to add to is existing network of 713 branches. Axis Bank opens office in Dubai Axis Bank net rises 63% on strong biz growth Axis Bank Q3 net grows 66% AXIS Bank rides on core business growth More Stories on : Banking | Financial Performance | Private Banks
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