Sharp drop in bad debt provision pushes net BoM up 115% to Rs 355 crore – The New Indian Express



MUMBAI: Maharashtra’s state-owned bank said on Thursday its March quarter net profit more than doubled to Rs 355 crore from Rs 165 crore a year ago on improved loan sales and asset quality, resulting in lower provisioning and a better cost-income ratio.

For the full year to March, the Pune-based lender saw its net profit double to Rs 1,152 crore from Rs 550 crore in FY21.

Managing Director and Managing Director AS Rajeev attributed the robust numbers to the general improvement in sentiment and growing demand for credit.

As a result, advances increased by 25.62% to Rs 1,35,240 crore for the year and the better trading environment led to improved repayments bringing gross NPAs to 3.94% and net NPAs to 0.97%.

The bank saw a massive improvement in overall asset quality with further slippages at Rs 728 crore matching recoveries at the same amount for the year.

Its gross NPAs fell by almost half from 7.23% in the March 2021 quarter to 3.94% and 4.73% in December 2021, while net NPAs fell by more than half to 0, 97% compared to 2.48% in March 2021 and 1.24% in December 2021. December 2021.

This led the bank to reduce its provisions, which plunged 73% to Rs 365 crore year on year from Rs 1,341 crore and Rs 836 crore in the December quarter, down 56%.

While total business increased by 19.84% to Rs 3,37,534 crore, gross advances increased by 25.62% to Rs 1,35,240 crore in the fourth quarter from Rs 1,07,654 crore in the fourth quarter of FY21 and net advances increased by 28.09% to Rs 1,31,170 crore. and total deposits increased by 16.26% to Rs 2,02,294 crore, of which the low cost Casa stood at 57.85%.

Rajeev said net interest income, which is the difference between what the bank earned on loans after paying interest on its funds, rose by 16.56 per cent to Rs 1,612 crore over the course of of the quarter, the net interest margin having improved to 3.17%, while the cost to income ratio was contained at 44.76%.

Anticipating a year of stronger growth and profitability, Rajeev told PTI that he expects demand for loans, which was strong in the quarter under review, to remain stronger throughout the year. with an overall growth of 18-20%, while it could be a little lower at 16-18% in the first quarter, which is normally a period of low consumption.

Likewise, he expects the flow of deposits to be stable at 15-16% in the current financial year. However, the drop in other income pushed down the overall income for the quarter to Rs 2,134 crore from Rs 2,620 crore.

His fee-based income rose to Rs 372 crore and non-interest income stood at Rs 522 crore. The cost/income ratio improved to 44.76% from 41.17% in Q4FY21.

The same was 45.63% for the December quarter. Loan growth was driven by retail, agriculture and MSMEs, which grew by 18.66% year-on-year.

Retail advances increased by 23.63% to Rs 35,422 crore, while MSMEs increased by 13.60% to Rs 26,279 crore.

The BoM meter gained 2% to close at Rs 18.15 on BSE on a day when the benchmark Sensex rose 1.23%.


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