IndusInd Bank has posted 25 per cent growth in net profit, at ₹495 crore, in the fourth quarter ended March 2015. The profit was driven by healthy fee income, loan growth and a drop in provisions.

During the quarter, net interest income (interest earned on loans minus interest expended on deposits) increased 18 per cent to ₹925 crore, while other income jumped 26 per cent to ₹658 crore on the back of 29 per cent growth in core fee income.

Provisions and contingencies dropped 11 per cent to ₹107 crore from ₹121 crore.

“The recovery in the commercial vehicle (CV) segment was good…Growth will pick up and we could see 15-16 per cent growth in non-food credit. We expect growth to be about 25 per cent, going forward,” said Romesh Sobti, MD and CEO, IndusInd Bank.

The gross non-performing assets ratio improved to 0.81 per cent as at March-end 2015 from 1.12 per cent a year ago.

Sobti added that the bank will rebalance its loan book (which had tilted towards corporates) with improvement in the CV segment.

To cut SB rate As a precursor to cutting its minimum lending rate (or base rate), IndusInd Bank has decided to reduce the interest rate on savings bank deposits to the standard 4 per cent from 4.5 per cent on balances up to ₹1 lakh from May 1.

The bank also cut interest rates on savings bank deposit in another slab — daily balances between ₹1 lakh and ₹10 lakh will fetch 5 per cent return against 5.5 per cent.

Daily balance above ₹10 lakh will continue to earn 6 per cent interest.

Sobti said this revision will be “margin positive”. Also, the high interest rate has helped improve the bank’s CASA (current account, savings account) share, which is nudging closer to the targeted 35 per cent.

CASA ratio stood at 34.13 per cent as on March 31, 2015, compared to 32.55 per cent on March 31, 2014.

In October 2011, after the RBI deregulated interest rates on savings deposits, IndusInd Bank, YES Bank and Kotak Mahindra Bank had increased the rates to attract customers.

The IndusInd Bank chief also hinted that the bank will cut its base rate soon. At present, its base rate or the minimum lending rate is at 11 per cent.

“Rates are going down and ours (rate cut) is also imminent,” said Sobti.

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