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Kotak Mahindra Bank posted a net profit of Rs 249 crore for the quarter ended March 31, 2010, up 23 per cent from Rs 203 crore in the corresponding year-ago period.
The growth in profit was on account of higher interest income. Lower slippages in non-performing assets, along with recovery from written-off assets also helped boost profits.
“In the last one year we saw a finer credit cycle. We did not see any new NPAs and there was recovery in old assets. The new provisioning we did in the fourth quarter was lesser than the recovery,” said Mr Uday Kotak, Vice-Chairman and Managing Director.
During the fourth quarter, the bank had a net write-back of Rs 7 crore in provisions, against a provision of Rs 128 crore last year.
Recovery from written-off assets was Rs 10-15 crore.
Net interest income was up 18 per cent to Rs 622 crore (Rs 526 crore). Non-interest income was lower at Rs 191 crore (Rs 251 crore).
For the full year the bank posted net profit of Rs 818 crore, up 46 per cent from Rs 561 crore in the previous fiscal.
Advances grew by 41 per cent and deposits by 23 per cent. The bank financed its credit growth by borrowing in foreign currency which was fully hedged and re-financing of its agri and rural loans, ahead of the interest rate increase cycle, Mr Kotak said.
During the fiscal the bank also raised capital by selling 4.5 per cent stake to Japan-based Sumitomo Mitsui Banking Corporation, through a preferential issue.
At the end of the year the outstanding foreign currency borrowings were at around Rs 2,300 crore. This was raised at 50-75 basis points lower rates than domestic rupee deposits, he said.
In the current year the bank is expecting credit growth of around 30 per cent.
Consolidated results
On a consolidated basis, the group posted net profit of Rs 1,567 crore for the fiscal 2010-11, up 20 per cent from Rs 1,307 crore in the previous year.
Shares of Kotak Bank closed at Rs 422.30, up 2.21 per cent, from the previous close of Rs 413.15, on the BSE, on Thursday.
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