Key interest income measures of Spread and NIM contract
KOCHI: The South Indian Bank (SIB), facing pressure on key interest income measures, failed to achieve significant sequential growth in net profit, closing the first quarter (Q1-FY25) with a net profit of Rs294 crore, compared with Rs288 crore in the previous quarter.
However, the bank witnessed a year on year (YoY) growth of 45 per cent in net profit when compared with Rs202 crore the bank logged as quarterly profit a year ago.
Both interest spread and net interest margin (NIM), key measures, contracted during the quarter under review on a sequential and annual basis.
SIB closed at Rs26.54 in today’s trading, reflecting a discount of 24.17 per cent to its book value of Rs35 (as of July 18).
NII falls QoQ
The net interest income (NII) fell quarter on quarter from Rs875 crore to Rs866 crore falling by 1.02 per cent, whereas NII improved by 7.18 per cent from Rs808 crore year on year.
Operating profit for the quarter increased by 3.56 per cent from Rs490.24 crore recorded in Q1 FY-24 to Rs507.68 crore in Q1 FY-25.
Asset quality improves
The gross NPA (GNPA) came down by 63 bps from 5.13 per cent to 4.50 per cent on Y-o-Y basis, whereas the net NPA (NNPA) dropped by 41 bps from 1.85 per cent to 1.44 per cent on an Y-o-Y basis.
Deposits
Deposits grew by 8 per cent year on year from Rs95,499 crore to Rs103,532 crore. Retail Deposit grew by Rs7,702 crore from Rs92,043 crore to Rs99,745 crore, showing an increase of 8.37 per cent on a Y-o-Y basis.
NRI deposit grew by Rs1,721 crore from Rs28,382 crore to Rs30,102 crore, showing an increase of 6.06 per cent on Y-o-Y basis.
Advances
Gross advances grew by Rs8,478 crore from Rs74,102 crore to Rs82,580 crore, showing an increase of 11.44 per cent on Y-o-Y basis
Gold loan portfolio went up by Rs1,839 crore from Rs14,478 crore to Rs16,317 crore, showing an increase of 12.70 per cent on a Y-o-Y basis.
Capital adequacy of the bank stood at 18.11 per cent in June 2024 compared with 16.49 per cent in June 2023. The bank’s financial results include the financial results of its wholly owned subsidiary SIBOSL.
Seshadri, MD & CEO of SIB, stated that the strategy adopted by the bank continues to enable the business performance. “During the period, bank registered growth in all the desired segments with a focus on quality of assets across all verticals – Corporate, Auto Loan, Credit Card, Gold Loan etc,” he added.
