Kotak Bank Q2 net up 4%

BS 200 SCORECARD

Kotak Mahindra Bank's net profit in the quarter ended September 2004 rose by a modest 4 per cent to Rs 20.65 crore against Rs 19.84 in the corresponding quarter last fiscal.

Total income increased by 33.60 per cent to Rs 123.16 crore against Rs 92.18 crore. Net profit in the first six months of the current fiscal rose to Rs 42.71 crore, from Rs 39.18 crore.

Total income increased to Rs 237.59 crore compared with Rs 171.49 crore reported in the corresponding period of the last year.

Uday Kotak, executive vice-chairman & managing director, Kotak Mahindra Bank, said in the next two to three years the bank's branch network will be comparable to that of the largest foreign bank in India.

Standard Chartered Bank, the country's largest foreign bank, has 60 branches. Kotak Mahindra currently operates 23 full fledged branches across 16 cities.

"We plan to set up 75 to 100 branches by the end of financial year 2008 across 30 to 40 cities," Kotak said. The bank has adequate capital to fund the branch expansion plan but it wants to raise funds via subordinate debt issues, Kotak added.

Capital adequacy ratio stands at 12.95 per cent against 19.55 per cent a year ago. The bank incurred a treasury loss of Rs 3.5 crore against a profit of Rs 11.6 crore in the corresponding quarter last fiscal. The bank's entire SLR book has a average maturity of eight months.

"We are the least exposed to the risk of treasury losses as the bank anticipating a rise in interest rates shortened the duration of its portfolio in May," Kotak said.

Consolidated net profit of the group for the quarter ended September 30, 2004 dipped to Rs 32.50 crore against Rs 38.94 crore. Its total income, however, rose to Rs 317.74 crore against Rs 259.37 crore.

The consolidated net profit in the first six months of the current fiscal dipped to 63.19 crore against Rs 67.96 crore. Its total income rose during this period to Rs 598.71 crore against Rs 472.12 crore. Kotak Bank stock rose to a high of Rs 182 on Bombay Stock Exchange but closed unchanged at Rs 175.

Speaking on the banks overseas plans Uday Kotak said, "We want a huge domestic presence but at the same time would like to reach out everywhere in the world." Currently, the group has subsidiaries in London, New York and Dubai.