A rise in net interest income as well as other income and a fall in provisions has helped the bank book its highest-ever quarterly profit.
The net interest margin for the three months under review at 3.19% was however the lowest in the past five quarters, while the highest at 3.55% was seen in the year ago period.
Bank managing director Shyam Srinivasan attributed the lower NIM to the rise in deposit mobilisation at higher rates while asserting that “it was cyclical rather than structural”. Its total deposits rose by 19% while the cost of deposits rose to 5.73% from 4.57% in a year.
An 18.4% advances growth and lower bad loan ratio helped the bank’s net interest income for the quarter grow 8.5% to its highest ever at Rs 2123 crore. Other income rose to Rs 863 crore against Rs 534 crore. Operating profit at Rs 1437 crore was 13% higher than what it was the year ago period.
Provisions were 54% lower at Rs 91 crore, in line with improvement in asset quality. The bank’s gross non-performing assets ratio fell to 2.29% at the end of December 2023 from 2.43% a year back, although it was a tad higher sequentially.
The bank’s gross loan portfolio stood at Rs 2.03 lakh crore while total deposits were at Rs 2.4 lakh crore.