Syndicate Bank net up 22% to Rs 221 cr

BANKING SCORECARD

Syndicate Bank, backed by a smart 8 per cent increase in net interest income, has reported a 22 per cent rise in net profit to Rs 221 crore for the June 2007 quarter against the corresponding quarter of last fiscal.

Gross advances backed by increased uptake in the credit market rose 25 per cent to reach Rs 51,844 crore at the end of the first quarter. The bank has reported a marginal 7 per cent increase in the operating profit to Rs 314.5 crore as increased competition for deposits saw its costs grow.

This was also compounded by hardening of interest rates and higher depreciation of Rs 8 crore for investment of around Rs 132 crore incurred on account of accelerated core banking solution conversion in the last year and in the first quarter of the present year. 
 

Performance during quarter ended June 2007
Rs crore	Oriental  Bank		Andhra Bank		Vijaya Bank		Syndicate Bank
	2007	% chg	2007	% chg	2007	% chg	2007	% chg
Interest earned	1,534	35.1	989.4	30.2	898.2	46.4	1,846.30	50
Other income	146	13.3	112.5	10.4	68.5	20.9	153.1	14.1
Expenditure	1,355	42.2	878.6	34.1	795.5	57.5	1,684.80	58.5
Operating profit	325	7.4	223.4	8.2	171.3	12.2	314.5	4.2
Net profit	139.2	48	141.1	21.2	111.4	53.3	221	22.4
EPS (Rs)	5.56	10.3	2.91	21.3	2.57	52.9	4.23	22.2
CAR (%)		13.85% from 12.1%		12.49% from 14.38%		11.21% from 11.55%		4.23% from 3.46%

C P Swarankar, CMD, said total income increased by 47 per cent to Rs 1,999 crore backed by the growth in net interest income, while interest income for the quarter improved to Rs 1,846 crore.

"While the overall growth in interest income works out to 50 per cent, the increase in the interest on advances was to the extent of 58.4 per cent," he added. This growth was also contributed appreciably by profiting on sale of investments which added on to fee based income.

The net NPA was at Rs 391 crore from the earlier Rs 411 crore and according to the bank, it has maintained sufficient cushion towards provision requirement to cover up the unexpected defaults.

Syndicate Bank is also planning for a follow-on public issue in the current fiscal and, according to a bank official, they have got sufficient head room to raise up to Rs 2,000 crore. It is learnt that the bank may first raise around $125 million. The capital adequacy ratio is currently at 12.62 per cent.