Oriental Bank to add 225 branches this fiscal

Oriental Bank of Commerce plans to add 225 branches this fiscal.

“We plan to open 225 branches this year, of which, 175 would be in rural, semi-urban, and urban locations. About 50 branches have been earmarked for the financial inclusion villages, which would be opened if there is sufficient business volume,” Mr V. Kannan, Executive Director, Oriental Bank of Commerce, told Business Line.

The bank was allotted 569 villages with a population of over 2,000 under the financial inclusion programme. Last year, the bank opened 147 branches. About 1,800 employees will be recruited this year, said Mr Kannan. Despite recruitment of 2,675 employees last year, there was a net addition of 1,600 only due to retirement and attrition issues, he added.

For the next few years, the bank would see retirement of about 400 employees every year, he said. The average age of employees in the bank is about 47 years, thanks to the new addition and also the merger of Global Trust Bank, which happened a few years ago.

The bank aims at a business growth of 17 per cent during the current fiscal, and is adequately capitalised to meet the credit growth, said Mr Kannan.

anju@thehindu.co.in

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SKS Microfinance posts Rs 330 cr loss

SKS Microfinance, the country's only listed microlender, has suffered a loss Rs 330 crore in the quarter ended March 31, 2012, due to heavy provisioning and write-offs.

The company allotted Rs 278 crore under provisions and write-offs in the fourth quarter of FY'12 and 1,173.5 crore for the whole fiscal due to non-collection of Andhra Pradesh dues.

SKS Microfinance CFO S Dilli Raj said that total Andhra Pradesh portfolio has been reduced to Rs 236 crore from Rs 1,496 crore after the Microfinance Act was implemented in the state in 2010.

"Income has also gone down because of the reduction in the AP portfolio. We expect 25 per cent growth in revenue in the first quarter of the current fiscal," Dilli Raj said.

Total income stood at Rs 66.15 crore in the January-March quarter, against Rs 175 crore in the same period last fiscal, SKS said in a statement.

The company suffered a loss of Rs 1,361 crore for 2011-12 fiscal. It had a profit of Rs 111.63 crore in the previous financial year.

On further provisioning and write-offs, Dilli Raj said the Reserve Bank has given time up to five quarters to make provisioning and the microlender will take a call at later stage.

"Post the draw-down of Rs 1,000 crore in Q4, which is 2.4 times larger than the sum of Rs 417 crore obtained during nine months ended March 2011, the funding concerns are behind us," Dilli Raj said.

"With a cash and cash equivalent of Rs 669 crore and a capital adequacy of 35.4 per cent, our non-AP portfolio will grow quarter on quarter from now on. Also, the rated and unrated pool assignments of Rs 908 crore bring in concomitant capital relief of Rs 136 crore," he added.

The net tax deferred asset amounting Rs 460 crore as on March 31 has not been recognised. The said sum of Rs 460 crore will be available to offset tax on future taxable income, SKS said.

Shares of the company closed down 1.35 per cent at Rs 94.70 on the BSE.

SKS was the worst hit after Andhra Pradesh, which once considered microfinance capital of the country, witnessed a spate of suicides by borrowers two years ago allegedly due to the coercive recovery practices by some MFI agents.

The situation prompted the state government to come out with AP Microfinance Act which crippled the activities of MFIs.

Source: Financial Express

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Andhra Bank net up 8.6% in Q4

Andhra Bank net profit increased 8.6 per cent to Rs 339 crore in the fourth quarter ended March 31, 2012 compared with Rs 312 crore in the year-ago period.

According to the Bombay Stock Exchange filing, total income has increased from Rs 2,662 croe to Rs 3,229 crore.

For the year-ended March 31, 2012, the net profit stood at Rs 1,344 crore compared with Rs 1,267 crore in the previous year. Total income has increased from Rs 9,188 crore (Rs 12,198 crore).

nagsridhu@thehindu.co.in

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HDFC Q4 net rises 16% on strong loan demand

Housing finance major, HDFC reported a 16 per cent increase in net profit to Rs 1,326 crore in the January-March 2012 quarter against Rs 1,142 crore in the corresponding year-ago period.

The increase in profit comes on the back of a strong demand for home loans and higher income from operations.

In the full year-ended March 31, 2012, the housing finance major recorded a 17 per cent increase in net profit at Rs 4,123 crore (Rs 3,535 crore in FY11).

The board of directors of the housing finance company (HFC) have recommended payment of dividend at Rs 11 per equity share of Rs 2 face value as against Rs 9 per equity share for the previous year.

Mr Keki Mistry, Managing Director, HDFC, attributed the profitability in FY12 to strong demand for home loans and increase in the average size of new individual loans.

Year-on-year disbursements were up 18 per cent to Rs 71,113 crore (Rs 60,314 crore in FY11) and the average size of new individual loans rose to Rs 19.5 lakhs (Rs 18.60 lakhs last year).

Mr Mistry said he expects at least 18 per cent growth in loans in the current financial year.

Further, the net interest margin will be maintained at around 4.4 per cent.

In FY12, HDFC's loan book increased by 20 per cent to Rs 1,40,875 crore (Rs 1,17,127 crore). During the year, it sold loans amounting to Rs 4,978 crore.

NPAs

Gross non-performing loans as at March 31, 2012, amounted to Rs 1,069 crore (Rs 904 crore as at March-end 2011).

This is equivalent to 0.74 per cent (0.77 per cent last year) of the portfolio.

In FY12, HDFC reported a 21 per cent increase in its consolidated net profit (includes the financial performance of life insurance, general insurance and asset management subsidiaries) to Rs 5,462.51 crore (Rs 4,528.41 crore in FY11).

Shares of HDFC closed higher at Rs 663.55 per share, up 0.57 per cent, as against the previous close of Rs 659.80.

kram@thehindu.co.in

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Vijaya Bank aims 20% business growth this fiscal

The Bangalore-based public sector lender Vijaya Bank aims a 20 per cent growth in overall business in the current financial year with added focus on increasing its low-cost deposit base, a top official said.

"We aim an overall business growth of around 20 per cent in the current financial year, which should reach around Rs 1,65,000 crore," executive director Subhalakshmi Panse said.

In the past fiscal, total business stood at Rs 1,41,727 crore, which comprised Rs 83,056 crore deposits and Rs 58,671 crore advances.

"On the advances and deposit fronts, we hope to post 18-20 per cent growth this fiscal," she said adding that advances should reach Rs 68,000-70,000 crore and deposits around Rs 92,000 crore.

The Reserve Bank has set a deposit growth target of 16 per cent and 17 per cent for advances in the current financial year.

Referring to growth in the current account, savings account (Casa) deposit base, Panse said this will get the highest priority during this fiscal.

"We hope to grow our low-cost deposit base in order to protect our margin with lesser dependence on bulk deposits," she said.

By the end of last fiscal, the ratio of Casa to overall deposit stood at around 22 per cent and the bank now aims to increase this base.

Source: Financial Express

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