Vijaya Bank Q1 net profit up 54%

Vijaya Bank, on Wednesday, announced a robust 54.20 per cent growth in its net profit at Rs 111.36 crore for the first quarter ended June 30, 2012 (Q1).

The bank had clocked a net profit of Rs 72.22 crore in Q1 of last fiscal. Briefing reporters, Chairman & Managing Director H S Upendra Kamath attributed the impressive growth in the bank’s net profit to lower provisionings and lower tax payments.

The bank’s operating profit, however, took a big hit as it went down 20.48 per cent to Rs 258.87 crore in Q1 against Rs 325.51 crore in Q1 last year. This was mainly due to higher interest cost and operating expenses.

While the bank’s operating expenses rose by 19.92 per cent to Rs 319 crore during the reporting quarter (Rs 266 crore), the interest expended also rose by 27.90 per cent at Rs 1,742 crore (Rs 1,362 crore previous).   

While, the bank, during the quarter, made a provision of Rs 130.51 crore (down from Rs 231.29 crore in the same quarter of previous fiscal), its net interest income (NII) during the quarter rose by 7.57 per cent to Rs 455 crore from Rs 423 crore.  

According to Kamath, acute shortage of liquidity raised the interest cost and the bank also benefitted from various deposits or the CDs.

The bank’s net interest margin though, saw a dip at 7.76 per cent at Rs 2.14 crore as against Rs 2.32 crore in the previous quarter. Kamath conceded that the bank’s NIM was under pressure.

The bank’s yield on advances too saw a rise of 11.63 per cent during the reporting quarter (11.32 per cent previous). While the bank’s net non-performing assets during the said quarter stood at Rs 979 crore (Rs 833 crore previous), the gross NPAs were at Rs 1,693 crore (Rs 1,449 crore previous).

The bank made a modest cash recovery of Rs 80 crore during the reporting quarter as against Rs 113 crore in the same quarter of previous fiscal.

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