Pvt banks pip state-run peers in fourth quarter

Private sector banks have outperformed their public sector counterparts in bottomline growth during the March 2006 quarter (q4).

Of the 21 banks, 15 public sector banks reported net profit growth of 11 per cent compared with 20 per cent reported by six private banks. State Bank of India, the public sector major, has not yet announced its results.

The aggregate net profit of 21 banks increased 14 per cent to Rs 3,462.35 crore against Rs 3,032.27 crore, while operating profit increased by 25 per cent to Rs 7,652.50 crore (Rs 6,135.99 crore).

Their total income rose by 23 per cent to Rs 20,821 crore (Rs 16,962 crore), while interest expenditure increased 18 per cent to Rs 14,672 crore (Rs 12,431 crore) during the quarter.

Despite higher provisioning, the private banks managed to maintain their net profit growth. The private banks posted net profit of Rs 1,437.74 crore against Rs 1,203.63 crore, while 15 public sector banks reported a net profit of Rs 2,024.61 crore (Rs 1,828.64 crore).

The aggregate net provisioning of six private sector banks increased 320 per cent to Rs 1,086.81 crore during March 2006 quarter against Rs 258.89 crore in corresponding quarter of previous year.

Among public sector banks, Uco Bank, Vijaya Bank and Bank of Maharashtra plunged into the red, while seven other banks reported fall in their net profit growth during the quarter ended March 2006.

Canara Bank, Bank of India and Bank of Baroda posted over 100 per cent rise in net profit.

Uco Bank posted net loss of Rs 58.75 crore against Rs 7.25 crore net profit during the quarter. Bank of Maharashtra reported a net loss of Rs 33.41 crore against net profit of Rs 126.32 crore and Vijaya Bank posted Rs 35.53 crore net loss in March 2006 quarter compared with Rs 58.80 crore net profit in corresponding quarter of previous year.

South Indian Bank and Dena Bank are two exceptions. South Indian Bank has posted a net profit of Rs 16.31 crore against a net loss of Rs 1.37 crore in January-March 2005, while Dena Bank has recorded a net profit of Rs 130.47 crore in March 2006 quarter against net loss of Rs 39.20 crore in corresponding quarter of previous year.

Yes Bank, the newly listed private sector bank, has net profit of Rs 15.32 crore in March 2006 quarter against Rs 94 lakh in previous year quarter. UTI Bank, HDFC Bank and ICICI Bank posted bottomline growth of 29-30 per cent during the quarter.

Of the four associates of SBI, three banks "" State Bank of Indore, State Bank of Travancore and State Bank of Mysore "" posted 4-13 per cent rise in net profit but State Bank of Bikaner and Jaipur's net profit fell by 49 per cent during the quarter.

The list of other banks that have reported a decline in bottomline includes Oriental Bank of Commerce (41 per cent), Union Bank of India (40 per cent) and Corporation Bank (7 per cent)

These banks have made higher provisions after the Reserve Bank of India increased the requirement of general provisioning on standard loans from 0.25 per cent to 0.40 per cent, effective from the quarter ended December 2005.

ICICI Bank made a net provision of Rs 597.33 crore during March 2006 quarter against Rs 80.03 crore in corresponding quarter of previous year.

IDBI provided Rs 201.39 crore against Rs 2.30 crore towards provisions and contingencies, while HDFC Bank made Rs 181.60 crore (Rs 107.07 crore) net provision during the quarter.