State Bank of Travancore (SBT) has registered a drop in net profit in the first quarter 2010-11, earning Rs 149.8 crore as against Rs 179.59 in the same quarter last year. The bank posted an operating profit of Rs 270.53 crore compared to Rs 225.78 crore.
The bank clarified that the decrease in net profit was mainly due to higher provisions, lower profit from treasury operations and higher staff expenses arising from wage revision. S Balachandran, managing director of SBT, pointed out that the net interest income improved by 18.59 per cent at Rs 395.21 crore compared to Rs 333.25 crore at the end of June 2009. Net interest margin (NIM) remained steady at 2.84 per cent as at the end of June 2009.
Despite lower profit from treasury operations by Rs 11.85 crore, total non-interest income at the end of the current quarter is at Rs 127.46 crore, while the non-interest Income (excluding profit from treasury operations) is higher by 14.75 per cent over the previous year.
The cost of deposits (CoD) has been brought down to 5.45 per cent which is 88 bps below the CoD a year ago, while yield on advances (YoA) has dipped by 106 bps to 9.32 per cent. The capital to risk-weighted assets ratio (CRAR) stood at 13.21 per cent (under Basel II framework) as against 14.40 per cent in June2009.
Gross NPA stood at 2.36 per cent (1.89 per cent) and net NPA at 1.48 per cent (0.87 per cent). The deposit base of the bank increased by 21.40 per cent to Rs 53,005 crore from Rs 43,660 crore a year ago.
The CASA deposits of the bank grew by 18.15 per cent y-o-y. In a turnaround from the subdued trend of previous year, NRE deposits showed a growth of Rs 402 crore during the quarter to reach Rs 11,250 crore.
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Gross advances rose by 18.69 per cent year-on-year to Rs 39,036 crore from Rs 32,889 crore in Q1 of FY 09-10. SBT opened five new branches during the quarter, taking the total number of branches to 753.
The Bank has on hand RBI approval to open 44 more branches. Alternative channel reach was expanded further; 60 new ATMs were installed this financial year so far, taking the total number to 786.