Driven by strong growth in net interest income and other income, South Indian Bank posted a 7 per cent rise in net profit in the first quarter at ₹101.47 crore against ₹95.06 crore in the corresponding period of the previous year.

Operating profit registered a growth of ₹120 crore, up 46.25 per cent.

VG Mathew, MD and CEO, pointed out that the realignment of business strategies with emphasis on retail lending and CASA (current account, savings account) deposits contributed to the good performance despite a challenging environment in the banking sector.

The bank, according to him, has fully recognised the corporate stressed assets as non-performing assets (NPAs) during the quarter. In spite of remarkable growth in NII, non-interest income and operating profit, due to incremental provisioning needed for the stressed assets, the net profit for the quarter has been muted.

Total advances increased by ₹5,240 crore to ₹47,264 crore, registering a credit growth of 12.47 per cent year-on-year (y-o-y).

The growth drivers are SME, mortgage, agriculture and auto loans. Gross NPA and net NPA percentages of the bank improved 35 basis points each on y-o-y basis.

Mathew informed that the intensive efforts made in resolving the NPA issue have yielded strong results and the issue of large corporate NPAs, which has been bothering the bank for the last 8-10 quarters, has been fully resolved.

Deposits increased by ₹7,902 crore to ₹65,791 crore, registering a growth of 13.65 per cent y-o-y. CASA deposits rose by ₹3,132 crore to ₹16,586 crore, a growth of 23.28 per cent. CASA now stands at 25.21 per cent of total deposits. NRI deposits showed a healthy growth of 15.73 per cent, accounting for 26.45 per cent of total deposits.

The total business increased by ₹13,142 crore to ₹1,13,055 crore achieving a growth of 13.15 per cent y-o-y. The capital adequacy ratio stood at 12.13 per cent as on June 30.

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