SBM Net jumps 27% to Rs 136 cr on recovery, fall in NPAs

State Bank of Mysore (SBM) today reported a 27 per cent rise in net profit at Rs 136 crore for the three months to March on improvement in recovery and asset quality as it focused on non-corporate lending.
Interest income rose to Rs 1,791.6 crore from Rs 1,642.4 crore, while non-core income increased to Rs 260 crore during the reporting quarter from Rs 182.6 crore a year ago, SBM Managing Director Sharad Sharma said here.
The Bengaluru-headquartered SBI subsidiary reported major improvement in asset quality during the quarter as well as for the full fiscal with gross NPAs coming down to 4 per cent from 5.4 per cent both for the January-March period as well as for FY15, respectively. Net NPA, too, improved to 2.17 per cent from 3.3 per cent during the same period.

Sharma attributed the good set of numbers to improvement in asset quality and recoveries, especially from written off assets which jumped to Rs 38 crore in the March quarter, while the same rose to Rs 129 crore for the fiscal.
He said the profit would have been higher had it not been for the high tax outgo, which shot up to Rs 82 crore from a write back of Rs 23 crore in the year-ago period.
The bank's NIM, a gauge of profitability, was flat at 2.98 per cent during the quarter as well for the year ended March 2015, General Manager and Chief Financial Officer M P Sridharan said.

For FY15, the bank, which has over 82 per cent of its 1,115 branches in its home state of Karnataka, reported a 49 per cent jump in net profit at Rs 409 crore on a core income of Rs 6940 crore from Rs 6323 crore, while non-core income rose 34 per cent to Rs 767.6 crore.

The spike in non-core income was due to 154 per cent buoyancy in recovery of in written-off accounts, which constitute 27 per cent of net income, Sharma said, adding FY15's profit is the highest in the past two years.
The share of corporate loans came down to 55 per cent from 65 per cent a year ago, while farm loan share stood at 15 per cent and personal loans, including home loans, at 20 per cent. During the year, SBM's corporate loan growth was negative, Sharma added.

Gross NPA declined to Rs 2,136 crore in the fiscal from a high of Rs 2,819 crore, while the net NPA dropped to Rs 1,122 crore from Rs 1,630 crore.
Total business in FY15 crossed Rs 1,19,300 crore with deposits risinig 7.3 per cent to Rs 66,064 crore, and advances increasing 9 per cent to Rs 53,296 crore.