Indian Bank has reported a 36% increase in its net profit for the second quarter of the current fiscal year, with a profit of Rs 2,707 crore. This significant rise in profit can be attributed to the bank’s improved net interest income and a reduction in provisioning for bad loans.
The bank’s net interest income, which is the difference between the interest earned on loans and the interest paid on deposits, increased by 35% to Rs 4,664 crore. This growth was driven by a 17% increase in advances and a 13% increase in deposits. The bank’s net interest margin, which is a measure of its profitability, improved to 3.59% from 3.32% in the same quarter last year.
Indian Bank’s provisions for bad loans decreased by 24% to Rs 1,044 crore, which also contributed to the increase in its net profit. The bank’s gross non-performing assets (NPAs) decreased to 6.52% of its total advances, from 7.23% in the same quarter last year. The bank’s net NPAs also decreased to 2.01% from 2.55% in the same quarter last year.
The bank’s operating profit increased by 27% to Rs 3,421 crore, driven by a 35% increase in its net interest income and a 17% increase in its non-interest income. The bank’s non-interest income, which includes fees and commissions, increased to Rs 1,757 crore from Rs 1,501 crore in the same quarter last year.
Indian Bank’s capital adequacy ratio (CAR) improved to 15.59% from 14.51% in the same quarter last year, which is well above the regulatory requirement of 10.875%. The bank’s return on assets (ROA) improved to 1.34% from 1.03% in the same quarter last year, while its return on equity (ROE) improved to 15.69% from 12.53% in the same quarter last year.
Overall, Indian Bank’s financial performance for the second quarter of the current fiscal year has been impressive, with significant increases in its net profit, net interest income, and operating profit. The bank’s reduction in provisioning for bad loans and improvement in its asset quality have also contributed to its improved financial performance.