FPJ BUSINESS DESK Mumbai
Backed by provisioning towards bad debts, investment depreciation, restructured accounts, Corporation Bank on Thursday registered a marginal increase of 5.2% in its net profit to Rs. 402.22 cr for the third
quarter ended December 2011, compared to Rs. 382.42 cr for the corresponding period last year.
” Had it not been for the higher provisioning and a steep spike in the cost of funds ( from 5.72 to 7.64%), our profit would have been much better,” Chairman and Managing Director Ajay Kumar said.
” The cost of deposits was pulled up even though yield on advances increased as well as the provisions were also high which led to small increase in net profit of the bank in this quarter” said, Ajai Kumar added.
The gross non- performing assets ( NPA) rose to 1.35% from 1.26% as on December 2010. Accordingly, the bank made provisions of Rs. 301 cr in the third quarter, a rise of 54% over Rs. 195 cr in the same period last fiscal. The net NPA stood at 0.96%. Provision coverage was at 62.88%. The net interest income during the quarter rose by 4.5% to Rs. 862 cr. And the non- interest income increased by 56.6% over the third quarter of financial year 2011 to reach at Rs. 442 cr during the quarter. During the quarter the total deposits increased by 28.5% and stood at Rs. 126,607 cr from Rs. 98,526 cr.
The banks exposure to 2Gscam telecom company is Rs. 146 cr and is entirely for the Videocon company said the chairman.
” Restructuring in this quarter is Rs. 741 cr out of which GTL and Chennai network have total of Rs. 420 cr and the slippage for Kingfisher is Rs. 160 cr”, said the senior official of the bank. The official added that the banks total exposure to the aviation sector is about Rs. 1400 cr out of which Rs. 300 is for Kingfisher and the remaining is for Air India.
CASA ratio grew by 11.6% year on year and the cost to income ratio was 36.64%, while the net interest margin ( NIM) was at 2.66%. Total number of branches and ATMs of the bank as on Dec 2011 stood at 1431 and 1262 respectively, as against 1255 and 1174. The total number of Grameen Vikas Kendras under Financial Inclusion stood at 2625 as on December 2011. The bank will get Rs. 600 cro after the recent CRR cut announced by the RBI said the bank.
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