Indian Bank has reported an 11.5% increase in its standalone net profit for the second quarter ended September 2017 to ₹451.54 crore, from ₹405.15 crore in the year-earlier period.
The increase in profitability was due to higher business growth, said Kishor Kharat, managing director and chief executive officer, Indian Bank.
Total income rose 6.45% to ₹4,874 crore, from ₹4,579 crore. Net interest income (interest income less interest expenditure) surged 20.8% to ₹1,543.67 crore, from ₹1,278.26 crore. Other income increased by 22.2% to ₹714.59 crore, accounting for about 31.6% of net revenue, against ₹583 crore in the comparable year earlier period.
During the period under review, gross non-performing assets (GNPA) were contained at 6.67% of gross advances, against 7.28%.
In turn, net non-performing assets came down from 4.62% to 3.41% of net advances. Provisions and contingencies stood at ₹924 crore, mainly triggered by cases referred to the National Company Law Tribunal, against ₹601 crore in the the year-earlier period. The non-performing asset loan provision coverage for the quarter was 65.4%.
Capital adequacy
“This is the first time that NPAs have come down to 4%,” Mr. Kharat said. “We want to bring it down to 3% next year,” he added.
The bank’s capital adequacy ratio (CAR) as per Basel III norms stood at 13.16%. Total deposits grew 11.5% to ₹11,98,669 crore and total advances by 14.2% to ₹1,44,206 crore.
The results buoyed the shares, which rose 9.2% to close at ₹379 on the NSE.