Vijaya Bank net profit up 228%

Bengaluru-based public sector lender Vijaya Bank on Friday reported a massive 228 per cent rise in net profit at Rs 37.40 crore for the third quarter ended December 2014 on account of treasury profit.

The bank had reported net profit of Rs 11.39 crore in the corresponding quarter last year. The total income went up 14.9 per cent to Rs 3,302.67 crore compared with Rs 2,874.60 crore a year ago. The operating profit was up 109 per cent to Rs 350.53 crore compared with Rs 167.72 crore.

Briefing reporters, Vijaya Bank Managing Director and CEO Kishore Sansi said, “The rise in profits was aided by a 12.14 per cent rise in net interest income at Rs 555 crore, its highest in any quarter, and treasury profit of Rs 158 crore.”

Net Interest Income (NII), or the difference between the interest earned on loans and the interest paid on deposits, stood at Rs 555 crore in the fiscal third quarter, up 12 per cent from Rs 495 crore a year ago.

The public sector lender’s other income rose nearly 108 per cent to Rs 269 crore in the October-December period, up from Rs 129.4 crore a year ago. Provisions for bad loans stood at Rs 308.4 crore, up over 93 per cent from Rs 159.4 crore reported in the same quarter last year.

The bank’s asset quality worsened on a quarter-on-quarter basis as gross NPA ratio stood at 2.92 per cent on December 31, 2014, higher than the 2.85 per cent reported in the September quarter. Net NPA ratio stood at 1.89 per cent in the October-December period, marginally higher than the 1.88 per cent. 

The bank has managed to shed Rs 4,800 crore worth of high cost deposits during the third quarter. Another Rs 8,000 crore high cost deposits will be either reprised or shed during the fourth quarter, Sansi said. During the quarter, the bank witnessed fresh slippages of Rs 744 crore.

After writing off Rs 308 crore and a recovery, its net NPAs stood at Rs 72 crore, he said. The provision coverage ratio stood at 65.77 per cent. The percentage of CASA deposits improved to 19.08 per cent from 17.84 per cent. The capital adequacy ratio under Basel-III dipped to 10.57 per cent from 10.78 per cent a year ago. The tier-I ratio stood at 7.82 per cent and tier-II at 2.75 per cent.

The bank is planning to raise Rs 500 crore through tier-I bonds and another Rs 500 crore from tier-II bonds during the fourth quarter, Sansi added.