Indian Bank on Thursday reported a 15 per cent rise in net profit at Rs 412.28 crore for the July-September quarter, despite an increase in provisions for bad loans.
In a statement, it said that during the corresponding period of the last fiscal, the bank had reported a net loss of Rs 1,755 crore.
Its net Interest Income (interest income less interest expenditure) during the second quarter of FY 2021 rose by 32 per cent to Rs 4,144 crore, from Rs 3,139 crore for Q2 FY20. On a QoQ sequential basis, it increased by 7 per cent.
Net revenue of the bank – Net interest income plus other income – for Q2 FY21 grew by 31 per cent and was at Rs 5,755 crore as against Rs 4,388 crore for Q2FY20.
The results are not strictly comparable with that of previous year’s as Kolkata-based Allahabad Bank merged with Indian Bank on April 1, 2020.
Indian Bank’s total income rose to Rs 11,669.11 crore during September quarter this year from Rs 6,045.32 crore in the same period of the previous fiscal, it said in a regulatory filing.
On asset quality front, gross non-performing assets (NPA) rose to 9.89 per cent of gross advances at the end of September 2020 from 7.20 per cent a year ago.
However, net NPA declined to 2.96 per cent of the advances at the end of second quarter of this fiscal from 3.54 per cent a year ago.
The bank’s provisioning for bad loans and contingencies rose to Rs 2,284.11 crore during July-September quarter from Rs 909.36 crore in the corresponding quarter a year ago.
Provisioning for bad loans alone doubled to Rs 1,880.19 crore at the end of September 2020 from Rs 720.90 crore a year ago.
Provision coverage ratio rose to 84.39 per cent as on September 30, 2020.
The Chennai-based lender said the extent to which the COVID-19 pandemic will impact the bank’s results will depend on future developments, which are highly uncertain.
Indian Bank’s capital and liquidity position is strong and would continue to be the focus area, it said.