ING Vysya Bank net grows 2.2% to Rs 180 crore in Q2

Gross NPA ratio & Net NPA ratio improved to 1.59% and 0.42% respectively

Bangalore-based private-sector lender ING Vysya Bank on Tuesday reported a marginal growth of two per cent in net profit at Rs 180 crore for the second quarter ended September 30, 2014, compared to Rs 176.3 crore in the year-ago period.

The bank’s total income for the quarter grew 16.1 per cent to Rs 725.5 crore, compared to Rs 625 crore in the same quarter last year. The operating profit grew 15.7 per cent to Rs 319.6 crore from Rs 276.3 crore in the year-ago quarter.

“Higher provisions made during the quarter impacted our net profit. We have seen a fresh slippage of Rs 190 crore during this quarter, of which the single-largest slippage was to the tune of Rs 70 crore in the agro-based sector. However, the worst is behind us and we hope to perform better in the next two quarters,” said Jayant Mehrotra, chief financial officer, ING Vysya Bank.

For the quarter under review, the bank has made a provision of Rs 50 crore, up from Rs 18 crore in the year-ago period. Its net interest income went up 12.8 per cent to Rs 497 crore in the second quarter from Rs 440.3 crore. Other income grew 23.8 per cent to Rs 228.6 crore from Rs 184.7 crore a year ago.

The net interest margin was at 3.54 per cent compared to 3.46 per cent in the year-ago quarter.

Gross non-performing asset (NPA) ratio and net NPA ratio improved to 1.59 per cent and 0.42 per cent, respectively, as on September 30, 2014 from 2.39 per cent and 0.87 per cent on June 30, 2014. During the quarter under review, a few NPA accounts, primarily from mid-corporate segment, were sold to an asset reconstruction company. These were sold following RBI’s new guidelines and after marking them down to about 40 per cent of the principal value. The bank realised Rs 165 crore from the assets sold to asset reconstruction companies, Mehrotra said.

Return on assets dipped to 1.16 per cent from 1.25 per cent in the year-ago quarter. The capital adequacy ratio also dipped to 14.39 per cent from 16.25 per cent. The bank might look at raising funds through infrastructure bonds during the third or fourth quarter, Mehrotra added.

Current and savings account (CASA) deposits grew 13 per cent to Rs 14,763 crore from Rs 13,012 crore. CASA ratio was at 33.1 per cent as on end-September 2014. Total deposits grew 12 per cent to Rs 44,652 crore from Rs 40,030 crore.