No more accounts in pipeline for restructuring: Dena Bank

Dena bank had significant exposure to DISCOMs and the power sector, but they completed the final bit of restructuring the past quarter. “Not only have we completed that restructuring of around Rs 800 crore, but we have also done the NPV provisioning at the beginning of the year so that our profitability going along does not get affected,” said Mitra.

Dena Bank reported a 42% year on year growth in net profit in the first quarter of FY13, however, their gross non-performing assets increased compared to last quarter. “The gross NPAs have increased a little bit because of the general economic scenario, but I am very confident that the asset quality is not going to deteriorate further,” said Mitra.

Below is an edited transcript of her interview with Sonia Shenoy.

Q: What was the net interest margins (NIM) that Dena Bank has reported this time around and what could be a sustainable margin for FY13?

A: First I will give you the major figures. The operating profit has gone up by 48.80% and the net profit has gone up by 41.97%. The net interest income has increased by 37.10% and the net interest margin is up by 16 basis points to 3.06%. The gross non-performing asset ratio has come down from 1.86% to 1.80%, and net NPA ratio has come down from 1.08-1.01%. The business mix is up by 31.33% and CASA is at 30.91%.

I would like to say that even if you take back the one-time income tax return which we got last year, we have shown improvement sequentially in the profit by around 48%.

Q: Your gross NPA number has actually deteriorated compared to last quarter?

A: In absolute terms the gross NPAs have increased a little bit because of the general economic scenario. I am very confident that the asset quality is not going to deteriorate further.

Q: What do you think your NIMs would hold at by the time the year closes up?

A: I am looking at a NIM of around 3% and I am very confident of meeting that. Asset quality is not a big concern so far as Dena Bank is concerned so we should be able to maintain NIM at 3%.