MUMBAI, MAY 18: Corporation Bank has proposed a dividend of 35 per cent for the financial year ended March 1999 subject to the Reserve Bank of India (RBI) approval. Announcing the bank's results at a press conference on Monday, chairman and managing director R S Hugar said its net profit had grown 15 per cent to Rs 192.03 crore from Rs 166.87 crore last year.Income from operations stood at Rs 1,356.30 crore compared to Rs 1,027.53 crore the previous year with total business registering an increase of 38 per cent to Rs 18,887 crore. Deposits and advances were up by 34.7 per cent and 46.10 per cent respectively at Rs 12,601 crore and Rs 6,286 crore. The credit-deposit ratio of the bank stood at its highest in ten years at 50. For the current year, the bank is targeting a total business of Rs 25,000 crore and Rs 8,000 crore advances, Hugar said. Gross non-performing assets (NPAs) increased to Rs 367.98 crore from Rs 341.86 crore although net NPAs were down to Rs 123.83 from Rs 126.46. The bank plansreduce the net NPA from 1.98 per cent of advances to 1.5 per cent in the current year.The non-interest income of the bank grew by 37.8 per cent to Rs 198.50 crore. Spread on interest rates was maintained at 3.1 per cent, while operating expenses as percentage to average working funds was maintained at 2.2 per cent.The capital and reserves of the bank were up at Rs 974.61 crore from Rs 84.8.97 crore the previous year. Its capital to risk adjusted asset ratio stood at 13.23 per cent on March 31, 1999, as against the stipulated 8.0 per cent, Hugar added.Investments of the bank at the end of the last fiscal, amounted to Rs 5,511 crore, compared to Rs 4,154 crore in the previous year, an increase of 33 per cent. Hugar said around Rs 110 crore was in SLR (statutory liquidity ratio) securities.He said the bank did not have more than five per cent exposure to any industry. There was no additional exposure to the recessionary sectors of cement, textile and paper over the last three years.Treasurybusiness contributed Rs 11.6 crore to the bank's profitability. Forex turnover grew by 34.9 per cent to Rs 48,636 crore from Rs 36,062 crore. Turnover from collection and payment services was Rs 60,000 crore - 12.25 per cent higher than the previous year. "Even in the wake of recessionary trend in several sectors and competition due to entry of new players, the bank's domination in cash management services continued," said Hugar. Trading (consignment-based) in gold and silver registered a turnover of Rs 5675 crore in 1998-99.The bank plans to open 34 new branches taking the total number of branches to 650 by the year end, as opposed to the current trend where most banks are in the process of reducing the number of branches and employees.Hugar said the bank had achieved full Y2K compliancy as on March 31, 1999, the RBI deadline. He revealed the bank was in talks with foreign players for a foray into the insurance sector. However, talks were still in the initial stages and it had not yet decided whetherto go into life insurance or general insurance. It has also applied for primary dealership to be carried out by its subsidiary, Corp Bank Securities Limited.
