Dhanlaxmi Bank net more than doubles in Q2

Mumbai, Oct. 20:Dhanlaxmi Bank's net profit more than doubled to Rs 4.35 crore in the quarter ended September 30, 2011, from Rs 1.62 crore in the same period last year.

The surge in profit was on the back of strong growth in net interest income (Rs 68 crore) and other income (Rs 44 crore), healthy recovery in bad assets (Rs 17 crore) and write-back in provisioning (Rs 5.30 crore).

Gross NPAs were lower at Rs 56 crore (Rs 90 crore) and the gross NPA ratio fell substantially to 0.55 per cent (1.26 per cent).

The lower NPA has helped the bank to improve the provision-coverage ratio to over 70 per cent from 45 per cent, without actually making higher provisions, said Mr Bipin Kabra, Chief Financial Officer, Dhanlaxmi Bank.

The growth in profit is also on account of increase in overall business. “Going ahead we will continue to grow at higher than industry average due to our low base. But we will not grow at 70-80 per cent growth as was seen earlier. We will see 25-30 per cent growth,” Mr Kabra said.

The bank would be looking to raise capital soon in order to meet the targeted growth, he added.

Managing Director and CEO, Mr Amitabh Chaturvedi, had recently said the bank is planning to raise equity capital by December to shore up its capital-adequacy ratio and support expansion plans.

In May 2011, the old generation private sector bank had announced that it will be raising Rs 1,000 crore in FY-2012.

Shares of Dhanlaxmi Bank closed at Rs 64.15, up 0.55 per cent on the BSE, on Thursday.