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Thursday, October 25, 2012

Kotak Mahindra Bank Q2profit muted at Rs 280 cr

Higher interest expenses and provisions tempered Kotak Mahindra Bank’s net profit in the July-September period.

The private sector lender’s standalone net profit increased 8 per cent to Rs 280 crore in the reporting period from Rs 260 crore in the year ago period.

Net interest income (the difference between interest earned and expended) grew 25 per cent at Rs 758 crore (Rs 605 crore in the year ago period).

Interest expended rose 36 per cent to Rs 1166 crore (Rs 859 crore). Provisions towards bad loans jumped to Rs 78 crore (Rs 16 crore).

During the quarter, the bank acquired a portfolio of non-performing assets (NPAs) of less than two years duration from non-banking financial companies.

“Entire amount of the purchase (net of subsequent recovery) amounting to Rs 42 crore has been treated as NPA and fully provided for,” said Dipak Gupta, Joint Managing Director, Kotak Mahindra Bank.

Net interest margins (NIMs) remained steady at 4.6 per cent. Year-on-year, advances rose 22 per cent to Rs 45,443 crore on the back of agriculture and corporate loans. Deposits increased 25 per cent to Rs 45,463 crore as on September 30, 2012.

“Commercial vehicles and construction will continue to slow in the fiscal year ahead,” Gupta said.

Consolidated results

The bank’s consolidated net profit for the second-quarter grew 16 per cent to Rs 502 crore from Rs 433 crore in the year-ago period.

The consolidated financials, among others, include the results of Kotak Mahindra Bank, Kotak Mahindra Prime, Kotak Securities, Kotak Mahindra Old Mutual Life Insurance.

On Thursday, the shares of Kotak Mahindra Bank ended 0.85 per cent higher at Rs 625.65 on the Bombay Stock Exchange.


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