Public sector lender Vijaya Bank today reported an 18.14 per cent decline in net profit to Rs 124 crore for the quarter ended December 31,2011,from Rs 152 crore during the corresponding period last year.
Its net interest income also declined slightly to Rs 475 crore in the third quarter,which the bank attributed to an increase in interest expenses,as well as reversals of some interest receivables following restructuring of two major accounts that had turned into NPAs.
“The total business of the bank reached an all-time high of Rs 1,37,594 crore during the period under review,comprising deposits of Rs 81,756 crore and advances of Rs 55,838 crore,a 21.15 per cent growth over the previous period,” Vijaya Bank Chairman and Managing Director H S Upendra Kamath told reporters here.
The bank’s total income surged to Rs 2,174 crore in the third quarter,up by 37.21 per cent from Rs 1,584 crore in the corresponding year-ago period,he said,adding that interest earned during the quarter stood at Rs 2,058 crore,as against Rs 1,483 crore last year.
The bank’s net NPAs stood at Rs 997 crore for the third quarter,compared to Rs 599 crore during the same period last fiscal,Kamath said.
“This was mainly due to two major accounts amounting to Rs 270 crore becoming NPAs during the period out of the Rs 280 crore addition to the net NPAs,” Kamath said.
The bank aims to reach a business level of Rs 1,44,000 crore in the fourth quarter,with a deposit target of Rs 85,000 crore and an advances target of Rs 59,000 crore,he said.
“Focus will be on improving the NIM by mobilising more CASA and retail deposits to reduce costs and increasing retail and mid-corporate advances for improving yields,” Kamath said. The Vijaya Bank CMD said yield on advances rose to 11.62 per cent during the first nine months of FY’12 from 10.13 per cent in the corresponding period of the previous year. The total interest income on advances during the period under review stood at Rs 4,403 crore,as against Rs 3,015 crore during the first nine months last fiscal.
He said the bank stood to gain Rs 390 crore from RBI’s move to reduce the CRR by 50 basis points,which will infuse Rs 32,000 crore into the credit market.
“This is a positive indication as the RBI wants to say that the market revival has started. Overall liquidity will go up and this will help banks to reduce their interest costs,” he said.