Huge Covid-related provisions dent Kotak Bank Q1 profit at Rs1,244.45cr

Treasury, BMU income declines from Rs586 cr to Rs36 cr

MUMBAI: Kotak Mahindra Bank, country’s second largest bank in terms of market capitalisation at Rs2.62 trillion (as of July 27), has reported a standalone net profit of Rs1244 crore for the first quarter ending June 30, 2020 (FY21) compared with Rs1360.20 crore for the same quarter last year.

The consolidated net profit for the same period was Rs1853 crore against Rs1932 crore for the comparable quarter last year.

While the corporate segment generated profit before tax of Rs1267.48 crore for the quarter under review, the income from treasury, balance sheet management & corporate centre segment during the quarter dropped hugely from Rs586.17 crore to Rs35.72 crore for the quarter under review.

The net interest income (NII) for Q1, FY21, increased to Rs3,724 crore from Rs3,161 crore in Q1,FY20, up 17.8 per cent, whereas the net interest margin (NIM) for Q1, FY21 was at 4.4 per cent.

The average savings deposits crossed Rs1 lakh crore, growing by a descent 34 per cent to Rs105,673 crore during Q1, FY21 compared with Rs78,654 crore for Q1, FY20.

Advances down

While the customer assets, which include advances and credit substitutes, were Rs2,16,819 crore as on June 30, 2020, a year ago, it was Rs2,17,446. At the same time, the advances as on June 30, 2020 were at Rs2,03,998 crore against Rs2,08,030 crore as on June 30, 2019.

The bank has made an additional COVID 19 related general provision of Rs616 crore in Q1, FY21, which took the total COVID related provisions as of June 30, 2020 to Rs1,266 crore (0.62 per cent of net advances).

The capital adequacy ratio (CAR) of the bank as per Basel III, as on June 30, 2020 was 21.2 per cent helped by a Rs7442 crore QIP issuance of 6.5 crore equity shares during the quarter.

As on June 30, 2020, the bank had a national network of 1,600 branches and 2,516 ATMs, and branches in GIFT City and DIFC (Dubai).

As on June 30, 2020, the gross NPA was 2.70 per cent and net NPA at 0.87 per cent. The subsidiaries & associates of the bank have made a net contribution to the tune of 33 per cent of the consolidated profit after tax (PAT) for the first quarter, FY21.