Total income for the quarter under review grew 15 per cent to Rs 3,713.06 crore from Rs 3,228.9 crore in the corresponding previous quarter. Total expenditure increased 16.8 per cent to Rs 2,999.41 crore in addition to a near 50 per cent jump in provisioning to Rs 365.13 crore. This lowered the pre-tax profit to Rs 348.52 crore from Rs 417.27 crore in the corresponding quarter last year.
The bank's asset quality deteriorated as the gross non performing assets (NPAs) more than doubled to Rs 3,714.49 crore (3.71 per cent) in the quarter from Rs 1,798.01 (2.12 per cent) crore in the year ago period. Net NPAs rose to Rs 2,409.18 crore (2.45 per cent) from Rs 755.85 crore (0.99 per cent).
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According to BA Prabhakar, chairman and managing director of Andhra Bank, large corporate houses contributed to most of the mounting NPAs. He said the bank was making a conscious effort to diversify its credit portfolio to reduce the exposure to them during the ongoing period of economic slowdown. "The environment was not conducive to growth last year and we did not really see much of demand for project finance. So, we focused on non-corporate finance credit," he said.
The bank has restructured loans to the tune of Rs 9,692 crore, of which two-thirds went to 18 power projects besides a substantial portion was owed by the state discoms during the full year ending March, 2013.
For the full year ended March, 2013, it reported a 4.13 per cent decline in net profit to Rs 1,289.13 crore as compared with Rs 1,344.67 crore in the previous year while total income grew 13.85 per cent.
In 2013-14, the bank expects a growth of 18 per cent in deposits and 20 per cent in advances, according to Prabhakar.