CSB Bank rose 2.10% to Rs 236.05 after the bank reported 88.5% jump in net profit to Rs 53.05 crore on a 36.4% rise in total income to Rs 599.24 crore in Q3 FY21 over Q3 FY20.
Net interest income improved 61.8% to Rs 251.2 crore in Q3 December 2020 from Rs 155.2 crore in Q3 December 2019. Operating profit in the third quarter stood at Rs 182.4 crore, up by 160.5% from Rs 70 crore in the same period last year.
Provisions and contingencies surged 303.7% to Rs 111.47 crore in Q3 December 2020 from Rs 27.61 crore in Q3 December 2019. Of this, the provisions for non-performing assets increased by 59.3% to Rs 56.21 crore in Q3 FY21 over Q3 FY20.
During the current quarter, as a prudent measure, the bank has made additional provision of Rs 85.10 crore (Rs 15.55 crore for the quarter ended 30 September 2020), against the further likely impact of COVID-19 pandemic in respect of exposure of the bank based on the assessment of presently available information. The aggregate provision against the likely impact of COVID-19, including the RBI mandated provision, as on 31 December 31, 2020 stands at Rs 144.87 crore.
Profit before tax in the third quarter was at Rs 70.9 crore, up by 67.2% from Rs 42.4 crore reported in the corresponding quarter last fiscal. Tax expense rose by 24.5% to Rs 17.8 crore in Q3 FY21 from Rs 14.3 crore in Q3 FY20.
On the asset quality side, gross non-performing assets (NPAs) stood at Rs 234.89 crore as on 31 December 2020 as against Rs 387.42 crore as on 30 September 2020 and Rs 352.63 crore as on 31 December 2019.
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The ratio of gross NPAs to gross advances stood at 1.77% as on 31 December 2020 as against 3.04% as on 30 September 2020 and 3.22% as on 31 December 2019. The ratio of net NPAs to net advances stood at 0.68% as on 31 December 2020 as against 1.30% as on 30 September 2020 and 1.98% as on 31 December 2019.
The Supreme Court of India, in a public interest litigation vide an interim order dated 03 September 2020, has directed banks that accounts which were not declared NPA till 31 August 2020 shall not be declared as NPA till further orders. If the bank had classified borrower accounts as NPA after 31 August 2020, the bank's proforma Gross NPA ratio and proforma Net NPA ratio would have been 3.42% and 1.93%, respectively.
Total advances as of 31 December 2020 were Rs 13,137.3 crore, an increase of 21.6% over 31 December 2019. Total deposits as of 31 December 2020 were Rs 17,753 crore, an increase of 16.5% over 31 December 2019. CASA deposits grew by 23.9% to Rs 5,393 crore in Q3 December 2020 from Rs 4,353 crore in Q3 December 2019. CASA ratio was at 30.4% as on 31 December 2020 as against 28.6% as on 31 December 2019.
The bank's total Capital Adequacy Ratio (CAR) as per Basel lll guidelines was at 21.02% as on 31 December 2020 as against 19.69% as on 30 September 2020. Liquidity Coverage Ratio was at 200%, well above the RBI requirement.
Speaking about the performance C VR Rajendran, managing director & CEO, said, The recent revival of the economic activity is having a positive impact on the banking industry as a whole and I am happy that we are no exception to this. In the context of the withdrawal of the moratorium benefits by the regulator, we decided to be prudent by holding provisions in excess of the regulatory provisions on the stressed assets. Apart from the core NII growth, improved trading income/provision reversals at treasury backed by the favourable yield movements, net income by way of PSLC sale etc supported us on the income side.
The key ratios viz NIM, Cost Income Ratio, RoA, RoE, Gross NPA, Net NPA, PCR & CRAR continued to be strong. On the topline front, our deposits and advances could register a YOY growth of 16% and 22% respectively. The new retail vertical with complete product suite and revamped policies will be established shortly. The new SME leadership is also working on volume growth by way of improved sourcing strategy, leveraging of' the branch network and customized product delivery. We look forward to building a sustainable business model by focusing more on these two segments apart from the gold loan portfolio. We will also have a focus on building retail deposit base during the current quarter.
CSB Bank has a a strong base in Kerala along with significant presence in Tamil Nadu, Karnataka, and Maharashtra. It offers a wide range of products and services to our overall customer base of 1.6 million, with particular focus on SME, retail, and NRI customers.
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