Central Bank turns the corner

Announcing the result here, Central Bank chairman and managing director S Doreswamy said the bank was able to bounce back into the black due to concerted strategic planning and policy initiatives taken during the last year. "We have strengthened the customer base and financial position of the bank," Doreswamy said.

As a result of the profit generated during the year and with the help of equity infusion by the government, the bank has achieved a capital adequacy ratio of 9.4 per cent against the Reserve Bank of India stipulated 8 per cent, he said.

The bank’s operating profit rose by 47.3 per cent to Rs 263.59 crore as against Rs 178 crore in the previous year. The income was higher by 17 per cent at Rs 2835 crore, of which the income from investments amounted to Rs 2,491 crore. This year 61 per cent of the investment was marked to market, with a target of 70 per cent next year.

The bank had zero growth in advances while the deposits grew by 16.7 per cent to Rs 23,051 crore from Rs 19,752 crore last year. Most of this, amounting to 30 per cent, has come from the saving bank segment. The non-performing asset (NPA) of the bank at 14 per cent of the net assets was at the same level as last year, said Doreswamy.

According to him, the bank has kept a target of Rs 200 crore net profit next year. The projected growth in deposits is 17 per cent and advances is 14 per cent. Though the bank had virtually undertaken no direct lending to business last year, it plans to provide credit to trading sector and consumer finance sector next year.