Private sector lender Kotak Mahindra Bank reported 99 per cent growth in the consolidated net profit for the quarter ended March 31, 2010, at Rs 418.6 crore compared with Rs 210.7 crore in the same period in the previous financial year. The company also announced its board had approved a 2:1 stock split to increase liquidity of the bank’s shares and enhance its retail shareholder base.
On a standalone basis, the bank saw 97 per cent growth in net profit to Rs 202.5 crore for the March 2010 quarter from Rs 102.6 crore in the corresponding quarter in the previous year.
Net interest income for the quarter grew 26 per cent to Rs 526 crore compared to Rs 418 crore last year. Other income jumped to Rs 251 crore in the fourth quarter from Rs 116 crore in the March 2009 quarter, mainly on account of returns from distressed assets the bank had bought in previous years.
The lender saw a 25 per cent increase in standalone advances over the financial year up to March 31, 2010. “We expect to grow our loan book by at least 30 per cent in the current financial year. The growth will be driven by lending to the auto sector, auto ancillaries, construction, housing and small & medium businesses,” said Uday Kotak, vice-chairman and managing director of Kotak Mahindra Bank.
Gross non-performing assets (NPAs) for the bank, on a standalone basis, stood at Rs 767.33 crore as of March 31, 2010, compared to Rs 689.2 crore a year ago, but was less than the Rs 928.23 crore reported at the end of the December 2009 quarter. The bank’s capital adequacy ratio was 18.4 per cent at the end of March 2010 (19.9 per cent at end of March 2009). Its Tier-I capital adequacy ratio was 15.4 per cent at the end of March 2010 (Tier-I ratio at the end of March 2009 being 16 per cent).
The bank currently had a provision coverage ratio (PCR), including technical write-offs, of about 58.5 per cent and would need to add about Rs 100 crore to provisions over the next two quarters to meet the central bank’s requirement of 70 per cent PCR by September 30, Kotak said.
Other major contributors to the group’s bottom line were auto financier Kotak Mahindra Prime and brokerage firm Kotak Securities, which registered profits after tax of Rs 166.4 crore and Rs 260.1 crore respectively. The group’s asset management company brought in a profit of Rs 72.46 crore, while its life insurance venture recorded a net income of Rs 69.22 crore.
For the financial year ended March 31, 2010, the bank saw its consolidated net profit double to Rs 1,307 crore from Rs 652.4 crore at the end of the previous year. The board has recommended a dividend of 8.5 per cent for 2009-10 as against 7.5 per cent for 2008-09. The bank’s stock fell 2.09 per cent on the Bombay Stock Exchange to close Tuesday’s trade at Rs 745.
