Bank of Maharashtra Q1 profit rises 25% on higher interest income

The bank’s asset quality has improved, with net NPA declining to 4.10%, against 5.98% on June 30, 2019. Gross NPA reduced to 10.93% against 17.90% in the same period.

Bank of Maharashtra (BoM) on Thursday reported a 24.72% rise in its net profit to Rs 101 crore for the June quarter, as its net interest income (NII) increased 19.14% to Rs 1,087.92 crore.

Gross NPAs declined to 10.93%, against 17.90% in the year-ago period. The bank’s provisional coverage ratio improved to 85.62% on June 30, 2020, against 81.24% a year ago.

AS Rajeev, MD & CEO, said the bank improved its performance during Q1, and it will be able to sustain this or do even better in the remaining quarters of FY21. Rajeev attributed the profit growth to increase in NII, decline in NPA and reducing costs by Rs 60 crore.

The bank’s asset quality has improved, with net NPA declining to 4.10%, against 5.98% on June 30, 2019. Gross NPA reduced to 10.93% against 17.90% in the same period.

As of June 30, loans of Rs 16,481 crore were under moratorium, with 24% of the customers availing moratorium. The bank had made Covid-19 provisions of Rs 425 crore for these loans in Q1, Rajeev said. BoM would be making similar provisions in Q2 and Q3, and even if 10% of these loans turn into NPAs after moratorium ends, the bank would have made sufficient provisions and be able to manage and sustain this performance, Rajeev said.