Custom Search

Wednesday, October 17, 2012

Karnataka Bank Q2 net zooms on improved interest spread

An increase in interest spread and a reduced provisioning for non-performing assets helped Karnataka Bank register a 185.27 per cent growth in net profit for the second quarter of 2012-13.

Speaking to newspersons here on Wednesday, the Bank’s Managing Director, P. Jayarama Bhat, attributed this to the growth in operating profit, interest spread and to lower provisioning for NPAs.

The bank recorded a net profit of Rs 117.19 in the second quarter of this fiscal against Rs 41.08 crore in the corresponding period of the previous year, registering a growth of 185.27 per cent.

The operating profit for the period stood at Rs 158.77 crore (Rs 116.17 crore).

Bhat said that the interest spread, which is a difference between the cost of deposits and the yield on advances, has moved up by 37 basis points. The yield on advances during the period was 12.91 per cent (12.15 per cent), and the cost of deposits was 8.14 per cent (7.75 per cent). The net interest margin rose to 2.40 per cent (2.06 per cent).

Provisions and contingencies during the period more than halved to Rs 22.75 crore (Rs 47.93 crore).

NPA reduction

Stating that the bank has an NPA-controlling mechanism, he said the aim is to reduce the gross NPA to 2.50-2.75 per cent. During Q2, the gross NPA stood at 3.22 per cent (4.01 per cent) and net NPA at 2.08 per cent (2.22 per cent).

On the recovery front, he said the bank has set up a stressed asset management cell and a regular asset management cell. “We are giving thrust to retail advances so that delinquencies will be few,” he said.

The tax expense of the bank came down to Rs 18.83 crore (Rs 27.70 crore) during the period, Bhat said.

The net interest income for the second quarter was Rs 232.64 crore (Rs 181.48 crore), and ‘other income’ was Rs 86.89 crore (Rs 80.33 crore).

The bank posted a net profit of Rs 200.62 crore (Rs 90.86 crore) for the six months ended September.

On Wednesday, the bank’s share closed at Rs 123.40 on the BSE, up 0.65 per cent, against the previous close of Rs 122.60.


Post a Comment

Popular Posts

Desi Google | A2Z Famous Quotes | What's Cooking America | Joke Site