Chennai, July 23 Growth in net interest income and trading profits catapulted Indian Bank’s net profits by 52.4 per cent to Rs 331.6 crore in the first quarter of 2009-10, compared with Rs 217.6 crore for the same period last year.
Addressing a press conference here on Thursday, Mr M.S. Sundara Rajan, Chairman and Managing Director, said better net interest income; fee-based income and profit on sale of investment boosted the net profit.
Trading profits on sale of investments jumped four-fold to Rs 102.9 crore during the first quarter of 2009-10, from Rs 24.3 crore in the corresponding period the previous year.
Asked about the rise in bad debts, Mr Sundara Rajan said that the Reserve Bank of India’s directive to banks on floating (un-earmarked) provisions had impacted the bank.
According to the recent RBI rules, floating provisions cannot be used to reduce gross non-performing assets. He said the Rs 105 crore set aside as floating provision, which was available last year to reduce gross non-performing assets, was not available this year.
The bank was able to recover about Rs 219 crore of bad loans during the first quarter of this year against Rs 114 crore in the same quarter of 2008-09.
The net interest margin improved to 3.56 per cent (3.17 per cent). Deposits increased by 23 per cent to Rs 76,717 crore and advances reported a 17-per cent growth to Rs 51,984 crore as on June 30.Related Stories:
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