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Indian Bank Q2 net profit jumps 164% to Rs 1,089 crore

The bank's Managing Director and CEO SL Jain attributed the rise in profit to the improvement in other income, higher cash recoveries, reduction in provisions, and lower expenditure.

October 28, 2021 / 08:24 PM IST

State-run Indian Bank on October 28 reported a 164 percent jump in standalone net profit at Rs 1,089 crore for the quarter ended September, aided by a fall in provisions and better recoveries.

The lender had reported a profit after tax of Rs 412 crore in the year-ago period.

The bank's Managing Director and CEO SL Jain attributed the rise in profit to the improvement in other income, higher cash recoveries, reduction in provisions, and lower expenditure.

Net interest income (NII) declined by one percent to Rs 4,084 crore in the quarter from Rs 4,144 crore in the year-ago period.

Domestic net interest margin (NIM) declined to 2.89 percent in Q2 FY22 as against 3.06 percent in the corresponding quarter of the previous fiscal.

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Non-interest income rose by 26 percent to Rs 1,966 crore as against Rs 1,558 crore earlier on account of an increase in recovery of bad debts (450 percent) and forex income (42 percent), the bank said in a release.

Total provisions dipped by 14 percent to Rs 2,187 crore from Rs 2,530 crore.

Total expenses dropped six percent to Rs 8,165 crore as compared to Rs 8,673 crore.

The gross non-performing assets (GNPAs) ratio improved marginally to 9.56 percent from 9.89 percent. Net NPAs stood at 3.26 percent as against 2.96 percent in Q2 FY2021.

Fresh slippages were at Rs 3,952 crore. Of this, Rs 1,820 crore came from Srei Group companies.

Cash recovery during the second quarter was Rs 831 crore.

Jain said in the second half of the current financial year, the bank is targeting recoveries of over Rs 4,000 crore.

He also said the bank has identified eight accounts worth Rs 1,900 crore to be transferred to the National Asset Reconstruction Company Ltd (NARCL).

For Q2 FY22, its total capital adequacy ratio (CRAR) stood at 15.88 percent.

Advances grew by 5 percent to Rs 3,85,730 crore in Q2 FY22 from Rs 3,65,896 crore a year ago. This was primarily driven by growth in RAM (retail, agriculture, and MSME) sector at 13 percent. Growth in retail, agriculture, and MSME was 14 percent, 16 percent, and eight percent, respectively.

Total deposits grew by 10 percent YoY to Rs 5,51,472 crore in September 2021 as against Rs 5,01,956 crore in September 2020.

The bank's scrip closed at Rs 174.35 apiece, down 8.24 percent on BSE.
PTI
first published: Oct 28, 2021 08:24 pm

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