State-owned lender Andhra Bank reported a 29.1 per cent increase in net profit to Rs 275 crore for the quarter ended December 31, 2009, as compared with Rs 213 crore during the same period last year.
Total business was up 23.03 per cent to Rs 1,17,899 crore, including Rs 66,547 crore deposits and Rs 51,352 crore advances, during the quarter from Rs 95,822 crore last year.
Speaking to the media here, Andhra Bank executive director Anil Girotra said yields on advances contributed to the growth during the quarter as retail, MSME and agriculture sectors grew 40.73 per cent, 53 per cent and 27.2 per cent respectively.
Net interest income during the quarter increased to Rs 583 crore, up 29.26 per cent, from Rs 451 crore during the same period last year. Non performing assets was up to Rs 446.95 crore as compared with Rs 373.36 crore.
Other income, however, was down to Rs 224 crore sequentially from Rs 233 crore during September as treasury income declined 30.88 per cent to Rs 47 crore from Rs 68 crore.
Girotra said the bank need not raise further capital as credit to risk weighted assets ratio (CRAR) was 14.95 per cent, as against the minimum 9 per cent prescribed by the Reserve Bank of India. This was despite making Rs 37.5 crore provisions for enhanced salary and pension during the quarter. Similar provisions would be made during the current quarter too depending on the agreements with the Indian Banks Association, he said.
The bank ceased to be a corporate agent for Life Insurance Corporation. It commenced operations of IndiaFirst Insurance Co Limited, a life insurance joint venture of Andhra Bank with Bank of Baroda and Legal and General (UK), this month. “Insurance will be a focus area of our fee-based services,” he said.
Andhra Bank, which would lose the commission from LIC, would supplement it by selling IndiaFirst products in at least 500 outlets shortly. It added 112 branches in the last nine months and would add another 20 during the current quarter.