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ING Vysya Bank reported an 18 per cent decline in net profits for the June quarter on higher provisions. The bank reported a net profit of ₹143.40 crore for the June quarter against ₹175.12 crore in corresponding quarter last year.
Net Interest Income (NII), the difference between interest earned and spent, grew 8.8 per cent to ₹463.1 crore during the quarter, from ₹425.4 crore in the corresponding quarter last year. This was after interest reversal of ₹20.5 crore in few large stressed accounts.
Increase in total income After adjusting for the interest reversals, the NII for the quarter grew 13.7 per cent to ₹483.6 crore. The adjusted net interest margins stood at 3.52 per cent, compared with 3.56 per cent in the corresponding last quarter.
Total income increased to ₹690.7 crore against corresponding last quarter’s ₹669.9 crore. The operating profit was lower 4 per cent ₹314 crore. Shares of ING Vysya Bank ended 1.2 per cent lower at ₹619.40 on the BSE on Tuesday.
Shailendra Bhandari, Managing Director, ING Vysya Bank said “We have been indicating for some time that the challenging macroeconomic environment would, at some stage, also impact our asset quality. We had a few accounts slip to NPA this quarter.
However with these large flows, we see stability return to asset quality and believe that fresh movements to NPA should revert to the levels we have normally experienced in the past. We have seen a strong pick-up in our core business, with growth in customer assets at 16 per cent and core cost-income ratio at 53 per cent.”
Provisions and contingencies during the quarter increased to ₹100.80 crore against corresponding previous quarter’s ₹68.11 crore. Jayant Mehrotra, CFO at ING Vysya Bank, said the accounts that slipped into NPAs included a company each in segments such as infrastructure, agro and processing.
The net incremental slippage during the quarter stood at ₹540 crore, he said. The gross NPA ratio and net NPA ratios stood at 2.39 per cent and 0.87 per cent respectively.
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