Money & Banking

IndusInd Bank Q3 net leaps 75%

Our Bureau Mumbai | Updated on January 19, 2011

17/01/2011 MUMBAI:( Left) Mr. Romesh Sobti, MD &CEO, IndusInd Bank and Mr. S. V. Zaregonkar, CFO,IndusInd Bank at the Q3 Financial Results, Press Conference held in Mumbai on January 17, 2011. Photo: Paul Noronha   -  PAUL NORONHA


Increase in yield higher than rise in deposit costs

IndusInd Bank's net profit rose 75 per cent to Rs 154 crore in the third quarter of 2010-11, aided by a good growth in both net interest income and other income. The bank had reported a profit of Rs 88 crore in the corresponding year-ago period.

Tight liquidity

Mr Romesh Sobti, Managing Director and CEO, said the third quarter has been challenging for the banking industry as a whole. “The liquidity situation has been tight in the market. Banks were faced with a challenge of re-pricing both their assets and liabilities”, he said.

Mr Sobti said the bank has been able to improve its margins as the increase in yield was more than the rise in cost of deposits.

“Net interest margin increased to 3.61 per cent (2.94 per cent). Sequentially also, our margins have increased by 20 bps”, he said. Gross yields increased to 12.31 per cent (12.10) while cost of deposits was up to 6.17 per cent (5.99). “We expect our NIM to expand for the next 8-10 quarters”, he added.

The bank will add another 40 branches by the end of this fiscal year taking its total network to 300 branches. Mr Sobti said the bank will not require further capital infusion in this fiscal.

“We may look at raising tier-2 capital in the next financial year,” he said.

Loan against property

The bank is planning to foray into loans against property and the credit card business. Mr Sobti said the bank will start offering credit cards to its customers in the next 6-8 months.

Mr Sobti said the bank is targeting to achieve a credit growth of 25-30 per cent in the last quarter of this fiscal.

IndusInd Bank's scrip ended at Rs 227 on the BSE on Monday, down 0.72 per cent from the previous close of Rs 228.65.

Published on January 19, 2011

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