Andhra Bank's net profit has increased 30.42 per cent at Rs 313 crore in the fourth quarter ended March 31, 2011, compared with Rs 240 crore in the year-ago period.

The net interest income (NIM) has gone up by Rs 861 crore, registering a 31 per cent growth.

“Sustained growth in advances along with good recoveries, among other factors, resulted in good profits,” Mr R. Ramachandran, Chairman and Managing Director, Andhra Bank, told newspersons here on Thursday.

For the full year ended March 31, 2011, the net profit has gone up by 21 per cent to Rs 1,267 crore (Rs 1,046 crore).

The total business increased by 22.4 per cent at Rs 1,64,310 crore. The earnings per share stood at Rs 26.05 (Rs 21.56).

Non-interest income, however, decreased by about Rs 68 crore on account of significant reduction in treasury income.

NPA DOUBLES

The gross and net non-performing assets (NPAs) almost doubled at Rs 995.64 crore (Rs 487 crore) and Rs 273 crore (Rs 95 crore) respectively.

“There has been an increase in NPAs as some of the restructured accounts had turned NPAs,” the CMD said.

OUTLOOK

Andhra Bank was expecting 18-20 per cent and 20-22 per cent growth in deposits and advances, respectively, in the current financial year.

“Our net interest margin had improved to 3.80 per cent (3.21 per cent). There may be marginal hit on NIM going forward,” Mr Ramachandran said.

The recent 50 basis point hike in interest rate on savings banks accounts by the Reserve Bank of India would cost an additional Rs 100 crore for the bank.

“The question is whether we will be able to pass this on to customers or not,” he added. A decision on interest rate hike is likely to be taken by the bank soon.

Andhra Bank plans to open 125 branches and recruit 1,775 officers and clerks during 2011-12.

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