SBT NET PROFIT JUMPS 33.55% IN Q2

According to Mr. P. Pradeep Kumar, Managing Director, State Bank of Travancore has posted a net profit of Rs 163.60 crore for the September quarter, representing 33.55 per cent growth over that in the corresponding period last year.

A 32 per cent jump in net interest income to Rs 415 crore facilitated a 37.71 per cent rise in operating profit year-on-year.

Net interest margin up

The net interest margin (NIM) improved by 13 basis points year-on-year to 2.86 per cent. The cost of deposits fell by 67 bps to rest at 5.55 per cent in September (6.22 per cent). The yield on advances rolled back 53 bps to 9.44 per cent (9.97 per cent).

The thrust on improving the quality of assets has started showing results, sources in the bank told Business Line separately.

The two heads of gross NPAs (up 10.38 per cent) and net NPAs (36.04 per cent) may reflect a worsening trend year-on-year, but have actually moderated on a sequential basis.

Trending down

Thus, gross NPAs have been brought down by 14.40 per cent from the first quarter of the current financial year and net NPAs by 21 per cent.

Provisions have recorded a big jump of 522 per cent year-on-year (14.66 per cent sequentially), but sources said these were made of several components ranging from those on bad debts to investments made.

‘Seasonality' also plays a big role in provision requirements, they added, pointing out that the bank had enjoyed the comfort of some write-backs during the last year.

On a different plane, the write-offs this year have brought down tax expenses by 35.02 per cent.

Compared to the first quarter this year, this represented a lesser outgo of 17.56 per cent under this head.

Financial inclusion

The financial inclusion initiative, ‘Janapriya savings account,' aimed at providing banking services at affordable costs, received a good response during the year.

More than 1.01 lakh accounts were opened under the scheme during the first half, taking the total number of such accounts to 11.12 lakh.

Total advances have grown by Rs 6,053 crore (17.33 per cent) year-on-year to touch Rs 40,978 crore.

The agriculture segment has been a standout performer of the half year with a growth of Rs 862 crore to touch a cumulative Rs 4,162 crore.

SOURCE: http://www.thehindubusinessline.com/2010/10/22/stories/2010102251450300.htm