State Bank of Mysore (SBM), an associate of State Bank of India group, On Tuesday reported a 40.6 per cent decline in net profit to Rs 49.84 crore for the fourth quarter ended March 31, 2009, compared to the corresponding quarter last year as the bank had to face a tough situation over high cost deposits and low returns on its advances.
The Bangalore-based bank reported this drop in net profit as its tax expenses shot up five times to Rs 39 crore, on top of a close to 40 per cent growth in interest payouts, even as it net interest income grew just over a per cent. Total income for the period rose 28.3 per cent to Rs 1,056.2 crore y-o-y.
Profit has declined despite the massive reduction in allocation made by the bank towards the provisions and contingencies.
The bank showed a 72.4 per cent drop in its provisions at Rs 20.8 crore. The operating profit for the quarter stood at Rs 181.3 crore, a marginal growth of 7.5 per cent compared to the corresponding quarter last year.
The bank’s capital adequacy ratio under Basel-II has improved to 13.38 per cent compared to 11.73 per cent in the year-ago period.
The earnings per share (not annualised) in the fourth quarter stood at Rs 14 compared to Rs 233 in the year ago period. The bank’s return on assets dropped to 0.46 per cent from 1.04 per cent in the corresponding quarter.
The percentage of net non performing assets to net advances marginally went up to 0.50 per cent as against 0.42 per cent in the year ago period. The board of directors, at a meeting held On Tuesday, has recommended 100 per cent dividend for 2008-09.