Mumbai, Jan 25 (PTI) All-round improvements in key metrics, especially on provisioning front which nearly halved, helped Indian Bank register a 102 per cent jump in net income at Rs 1,396 crore in the quarter ending December 2022.
The management of the Chennai-based public sector bank, led by managing director and chief executive Shantilal Jain, has guided towards better days ahead especially on the asset generation side, hoping to continue the good run rate on advances which have maintained a steady 13 per cent growth rate throughout the fiscal so far.
"We've been able to maintain our good show for the third quarter as well with all sources of income, be it net interest income, asset quality, or fee and forex income or loan sales, growing in the quarter. There is no one-off item in the numbers at all as all verticals performed well," Jain told PTI from Chennai on Wednesday.
The bank reported a 25 per cent growth in net interest income at Rs 5,499 crore in the quarter and the fee-based income grew 6 per cent to Rs 704 crore led by a 99 per cent spike in forex income at Rs 294 crore. This was driven by a healthy 71 basis points jump in net interest margin at 3.74 per cent from 3.03 per cent in December 2021.
Another key profit driver, Jain said, was the recovery which jumped 53 per cent on year to Rs 426 crore. This also had the bank seeing a 40 per cent reduction in provisioning at Rs 1,474 crore from the year-ago period.
Gross NPAs (Non-Performing Assets) declined by 260 basis points to 6.53 per cent or Rs 29,400 crore from Rs 36,000 crore, helping the bank more than halving net NPAs or by 172 basis points to 1 per cent, or at Rs 1,474 crore from Rs 2,439 crore, Jain said.
This had the provision coverage ratio improving by 810 basis points to 93.59 per cent, Jain said.
He said the recoveries through the NCLTs, one-time settlement and other means stood at Rs 426 crore, which was 53 per cent more than the year-ago period, while slippages declined to Rs 1,300 crore.
Advances increased 13 per cent to Rs 4,51,658 crore from Rs 4,00,432 crore in December 2021, of which the RAM (retail, agriculture & MSMEs) book grew 15, 15 and 6 per cent respectively to Rs 2,62,811 crore from Rs 2,33,738 crore.
The contribution of this book to gross domestic advances is 62 per cent. Home loans grew by 12 per cent, auto loans jumped 27 per cent and personal loan soared 35 per cent.
The bank's gold loan book, which is among the largest (Canara Bank is the largest among banks with around Rs 1 lakh crore of asset under management) grew 17 per cent to Rs 60,000 crore, Jain said, adding deposits rose at a tepid 6 per cent to reach Rs 5,97,114 crore.
Jain said to attract cheaper source of funding the bank has been offering higher prices to depositors as the repo rate has been moving up. Also, the bank is aggressively opening more salary accounts. Accordingly so far this fiscal, the bank has opened as many as 27 lakh new salary accounts. On the deposit side, it has increased pricing from 5.4 per cent to 7 per cent in certain buckets, he added.
The bank's cost-to-income ratio stood at 43.71, down from 44.75 in December 2021. PTI BEN HVA