Business Daily from THE HINDU group of publications
Sunday, Nov 09, 2008
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Business Daily from THE HINDU group of publications Sunday, Nov 09, 2008 ePaper | Mobile/PDA Version | Audio | Blogs |
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Money & Banking
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Financial Performance Corporate Results - Private Banks Depreciation moderates Lakshmi Vilas Bank’s profit growth 
Our Bureau Chennai, Nov. 8 But for a Rs 14-crore depreciation because of the diminution in market value of investments that Lakshmi Vilas Bank had to incur, the bank would have posted a much higher net profit than Rs 6.92 crore it recorded for the second quarter of the current year. In the second quarter of last year, the bank had made a net profit of Rs 5.37 crore. Fee-based incomeWhat bolstered the bank’s performance was a pick up in fee-based income, mainly fees from LCs and guarantees, which helped boost ‘other income’ to Rs 21.61 crore compared with Rs 12.28 crore in the comparable quarter of last year. In the first half of the year, the bank’s deposits (Rs 6,005 crore) grew by 20 per cent while advances (Rs 4,367 crore) rose by 26 per cent, but the bank’s Chairman, Mr V.S. Reddy, said there is no issue in finding resources to fund credit growth. Investments above the statutory minimum, which can be used to borrow from the Reserve Bank of India, and the release of funds from the recent cuts in cash reserve ratio, would together give the bank an additional Rs 400 crore. bonds issueBesides, the bank intends to raise funds through five-year bonds to strengthen Tier-II capital. It has headroom to raise up to Rs 140 crore, but is yet to take a decision on the quantum. Mr Reddy, told Business Line on Friday that a pick-up in advances began in September, the impact of which would be felt in the current quarter. He further said the bank is “positively inclined” to drop lending rates, which could happen in a couple of weeks. Lakshmi Vilas Bank full year profit rises 44% More Stories on : Financial Performance | Private Banks
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