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Tuesday, October 22, 2013

Federal Bank net up 5% on improved lending

Private sector lender Federal Bank posted a five per cent increase in net profit at Rs 226 crore in the July to September quarter on the back of healthy loan growth and stable credit costs.

The Kerala-based bank had reported a net profit of Rs 215 crore in the second quarter last year.

Healthy current and savings account (CASA), stability in credit costs and lower slippages helped our profits,” said Shyam Srinivasan, MD and CEO of Federal bank.

Net interest income was up 8 per cent to Rs 548 crore during the second quarter (from Rs 506 crore in Q2FY13). Other income was marginally up by 3 per cent to Rs 143 crore.

Net Interest Margin (NIM) grew to 3.30 per cent from 3.13 per cent in the first quarter. Year-on-year, the margins declined from 3.58 per cent.

“We will maintain our NIM in the 3.30 per cent levels going forward,” Srinivasan said.

Gross non-performing asset (NPAs) ratio improved to 3.39 per cent from 3.83 per cent in the corresponding quarter a year ago. On the other hand, net NPA ratio worsened to 0.98 per cent from 0.68 per cent.

Total advances increased 16 per cent year-on-year to Rs 42,220 crore as on September 30, 2013 (Rs 36,299 crore in Q2FY13). Total deposits were up 15 per cent to Rs 56,794 crore from Rs 49,518 crore in the same quarter last year. We continue to expect our retail and small and medium sector enterprises to grow over 24 per cent in the fiscal year,” Srinivasan said.

NRE deposits grew by 56 per cent to reach Rs 16,717 crore. Further, the bank raised about $70 million at an interest rate of about 8.75 per cent through the swap window facility provided by the Reserve bank of India. “We plan to raise about $30-40 million by November end,” Srinivasan added.

Source: thehindubusinessline


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