I
Indian Bank’s net profit, driven by other income, rose to ₹373 crore in the December quarter from ₹42 crore in the corresponding quarter of the previous fiscal.
The bank’s Managing Director and CEO, Mahesh Kumar Jain, attributed the significant growth in bottomline to a combination of factors including higher other income.
For the quarter ended December 31, 2016, Indian Bank’s operating profit grew 34 per cent to ₹1,021 crore from ₹761 crore in Q3 of FY16.
Other income rose 37 per cent to ₹600 crore (₹439 crore in the year-ago period). Thanks to demonetisation, the bank witnessed repayments to the tune of ₹2,200 crore from overdue and bad accounts.
However, the December quarter saw fresh slippages of ₹931 crore, which included two major accounts in the real estate and power sectors, involving a few hundred crores; the rest was in small ticket loans.
Gross non-performing assets (NPA) moved up to 7.69 per cent (from 5.61 per cent in Q3 of last fiscal and 7.28 per cent in Q2 of this fiscal) and net NPA to 4.76 per cent (3.17 per cent in Q3 FY16 and 2.74 per cent in Q2 FY17).
In the reporting quarter, Indian Bank’s net interest income (NII) grew 12 per cent to ₹1,247 crore (₹1,111 crore).
Credit offtake remained subdued at about ₹1,20,800 crore (₹1,20,416 crore). Retail loans grew 8 per cent to ₹62,957 crore (₹58,206 crore), while corporate loans reported a decline of 7 per cent to ₹57,843 crore.
Agriculture, micro, small and medium enterprise (MSME) and mortgage loans witnessed growth of 8.14 per cent, 14.94 per cent and 15.42 per cent, respectively.
“We are reducing our exposure to the corporate sector. We are avoiding power and infra segments. But we lend to road, drinking water and irrigation projects,” said Jain.
He also claimed that on an average about 84 per cent of Indian Bank’s ATMs were functioning (during the day).