 "Bank of Maharashtra Q2 results: Net profit up 44% on healthy NII growth")
Public sector lender Bank of Maharashtra’s (BoM’s) net profit during the second quarter of financial year 20224-25 (Q2 FY25) soared 44.24 per cent year-on-year (Y-o-Y) to Rs 1,327 crore, an impressive showing which was aided by a healthy rise in net interest income (NII).
Sequentially, the Pune-based lender’s net profit rose by 2.62 per cent from Rs 1,293 crore in June 2024 (Q1Fy25). Its stock closed 0.41 per cent higher at Rs 54.38 a share on BSE on Tuesday.
NII expanded 15.41 per cent Y-o-Y to Rs 2,807 crore in Q2FY25 compared to Rs 2,432 crore in the same quarter a year ago. Net interest margin (NIM) improved to 3.98 per cent in Q2FY25 compared to 3.89 per cent in Q2FY24. Sequentially, NIM was up by one basis point compared to 3.97 per cent in Q1Fy25.
Nidhu Saxena, managing director and chief executive of BoM, said the bank has been able to maintain NIM despite the concern expressed over cost of funds. The margins at 3.98 per cent have overshot the guidance of 3.75-3.85 per cent for FY25. The net profit is slated to cross Rs 5,000 crore mark in FY25. Out of which Rs 2,600 crore have already been booked in April-September 2024 (H1Fy25), he said in post results virtual media interaction.
The bank’s non-interest income has risen 19 per cent Y-o-Y to Rs 792 crore.
The lender’s provisions for non-performing assets (NPAs) were almost flat at Rs 598 crore in Q2FY25 compared to Rs 597 crore in Q2FY24. The asset quality profile improved with gross NPAs declining to 1.84 per cent in September 2024 from 2.19 per cent in September 2023. Net NPAs also declined from 0.23 per cent in September 2023 to 0.20 per cent in September 2024. The provision coverage ratio (PCR), including written-off accounts, stood at 98.31 per cent in September compared to 98.4 per cent a year ago.
Advances grew by 18.78 per cent Y-o-Y to Rs 2.17 trillion in Q2FY25. Retail advances grew by 22.53 per cent Y-o-Y to Rs 56,914 crore in September 2024.
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Total deposits increased 15.46 per cent Y-o-Y to Rs 2.76 trillion. The share of low-cost deposits -- current account and saving account (CASA) -- declined to 49.29 per cent in September 2024 from 50.71 per cent a year ago.
The bank’s capital adequacy stood at 17.26 per cent, with tier-1 at 13.13 per cent at the end of September 2024. It raised equity capital of Rs 3,500 crore through Qualified Institutional Placement (QIP) on October 05, 2024. Factoring in fresh capital raise, the capital adequacy is over 19 per cent now. The government of India’s stake is down to 79.6 per cent now from 86.46 per cent at end of September 2024, Saxena said.