Vijaya Bank net dips 39%

The MTM losses on investments have increased 2.84 times to Rs 71 crore compared to Rs 25 crore in the fourth quarter of 2012-13

Bangalore-based public sector lender Vijaya Bank on Tuesday reported a 39 per cent decline in net profit to to Rs 136 crore for the quarter ended March 31, compared with Rs 224 crore in the corresponding quarter of the previous financial year.

The hit taken by the bank in its treasury profits in terms of reduction in trading profit and increase in MTM (mark-to-market) losses dragged down the profit during the fourth quarter. The MTM losses on investments increased 2.84 times to Rs 71 crore, compared with Rs 25 crore in the fourth quarter of 2012-13. Trading profit on sale on investments have come down 76.4 per cent to Rs 25 crore against Rs 106 crore in the corresponding period of last year, said V Kannan, chairman and managing director.

The overall provisions went up 35 per cent to Rs 276 crore.

The total income during the fourth quarter had increased 13 per cent to Rs 3,029 crore from Rs 2,680 crore in the year-ago quarter.

The operating profit for the quarter also declined 14 per cent to Rs 333 crore, compared with Rs 388 crore in the corresponding period of the previous financial year.

Net interest income of the bank marginally went up to Rs 526 crore from Rs 517crore in the year-ago quarter, showing a rise of 1.7 per cent. The net interest margin dipped to 1.92 per cent from 2.21 per cent a year ago. The cost of deposits moved up marginally to 8.05 per cent from 7.96 per cent, while yield on advances dipped to 11.10 per cent from 11.35 per cent a year ago. The gross NPAs stood at Rs 1,986 crore at the end of fourth quarter, showing an increase of 29.5 per cent over the previous year. The percentage of net NPAs stood at 1.55 per cent as against 1.30 per cent in the same quarter last year.

The return on assets halved to 0.42 per cent from 0.85 per cent in fourth quarter last year.

The capital adequacy ratio under Basel-III stood at 10.56 per cent with core Tier-I equity of 8.13 per cent and 2.43 per cent of Tier-II. “The Bank has adequate leg room available to raise Tier-II capital. But, we are adequate capitalised for the current year taking into consideration the credit growth is around 20 per cent,” Kannan said.

The total business of the bank for the fiscal ended March 2014 grew 23.39 per cent to Rs 2,06,721 crore against Rs 1,67,531 crore in March 2013. The advances increased by 16.89 per cent to Rs 82,425 crore as against Rs 70,514 crore in the previous year. For the year 2014-15, the Bank is aiming at credit and deposit growth of 19 per cent, he added.