Aims at Rs 1.2-cr biz target; to mobilise retail deposits, increase fee income
Mumbai, Oct. 30
Strong growth in interest income has lifted the net profit of Indian Overseas Bank by 25 per cent for the second quarter ended September 30 to Rs 249.85 crore (Rs 198.49 crore).
The net interest income was Rs 611.91 crore (Rs 517.3 crore) while the net interest margin stood at 4.01 per cent (4.1 per cent).
Total deposits increased by 20.31 per cent to Rs 57,018 crore while gross credit grew by 40.28 per cent to Rs 41,141 crore.
On the deposit-credit mismatch, Mr T.S. Narayanasami, Chairman and Managing Director, IOB, said, "The system as a whole has not been getting long-tenor deposits. That is why we are raising long-term funds as Tier II capital and focusing on low-cost deposits."
The bank's share of low-cost current account and savings account deposits (CASA) to total deposits fell to 37.66 per cent (38 per cent) as on September 30.
Cost of deposits rose to 4.99 per cent (4.62 per cent) and the yield on advances climbed to 9.49 per cent (8.93 per cent). Provisions were lower at Rs 54.14 crore (Rs 91.21 crore). The bank saw recoveries of a little more than Rs 100 crore up to September 30, said a senior official from the bank.
Treasury profits dipped to Rs 9 crore (Rs 60 crore), pulling down other income. Fee income (excluding treasury income) grew to Rs 142.08 crore (Rs 104.88 crore). For the six months ended September, the net profit was Rs 471.89 crore (Rs 381.68 crore).
IOB will mobilise retail deposits, increase fee income and focus on effective NPA management.