Despite a jump in loan loss provisions, State Bank of Bikaner & Jaipur reported a 34 per cent increase in net profit at ₹238 crore in the fourth quarter ended March-end 2014 on the back of robust growth in net interest income and non-interest income.

The bank, which is an associate of State Bank of India, had reported a net profit of ₹178 crore in the year-ago period.

In the financial year ended March 31, 2014, the Jaipur-headquartered bank, however, reported a flat profit growth at ₹732 crore (₹730 crore in the previous year).

The bank’s board declared a dividend of 143 per cent (or ₹14.30 per share of ₹10 face value) against 161 per cent last year.

In the reporting quarter, net interest income (the difference between interest earned and expended) was up 33 per cent at ₹740 crore. Non-interest income increased 21 per cent to ₹336 crore.

Net interest margin (the excess of interest income over interest expense scaled by total assets) improved to 3.65 per cent from 3.14 per cent.

B Sriram, Managing Director, said his bank will endeavour to grow loans and retail deposits by 12 per cent and 16 per cent, respectively, in FY15. The bank has taken a conscious decision to go slow on commercial and institutional (C&I) loans even as it has stepped on the gas on the retail loans segment.

He said the bank will whittle down its high cost bulk deposits and certificate of deposits portfolio from ₹6,500 crore to about ₹5,000 crore in FY15.

On the asset quality front, Sriram said he expects loan upgrades aggregating ₹400 crore in the C&I segment; recovery of ₹100 crore from retail advances and about ₹250 crore from sale of bad loans to asset reconstruction companies in Q1.

Loan loss provisions jumped 70 per cent to ₹191 crore.

Shares of SBBJ closed at ₹350.20 per share, up 3.09 per cent on the BSE.

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