Reductions in PLR moderate interest income.
The moderation in credit growth and interest income due to the cut in prime lending rates (PLRs) put pressure on the net interest income (NII) of two banks – Bank of India (BoI) and Dena Bank – in the fourth quarter ended March 2009
But Bangalore-based Canara Bank bucked the trend by posting a robust 55 per cent growth in NII. While two large public sector banks – Canara and BoI – showed an improvement in other income, including fee-based income, Mumbai-based Dena reported a dip in other income.
Kerala-based Dhanalakshmi Bank’s other income jumped from Rs 14.64 crore to Rs 40.95 crore.
Canara’s net up 55%
A robust growth in net interest income and fees & commission helped Canara Bank to register a 55 per cent growth in its net profit at Rs 719 crore for the fourth quarter ended March 31, 2009 compared with Rs 464 crore in the corresponding quarter last year.
For the full year ended March 2009, the bank’s net profit went up by 32.4 per cent to Rs 2,072.42 crore as against Rs 1,565.01 crore for previous year.
The total income for the quarter rose by 22 per cent to Rs 5,500 crore. The NII rose by 41.5 per cent to Rs 1,305 crore compared with Q4 of 2007-08. An increase of 18.5 per cent rise in other income, which stood at Rs 864 crore, also contributed to the profit growth.
The bank’s cost of deposits rose to 7.02 per cent from 6.87 per cent. However, the yield on advances improved to 11.03 per cent in Q4 of 2008-09 as against 10.22 per cent a year ago. The net interest margin increased from 2.42 per cent in January-March quarter of FY08 to 2.80 per cent in March 2009.
BoI sees subdued growth
Mumbai-based Bank of India posted a growth of just 7 per cent growth in its net profit at Rs 810 crore for the fourth quarter ended March 31, 2009 from Rs 757.04 crore in Q4 of 2007-08. The subdued growth in credit and moderation in interest income was due to a cut in PLR which impacted margins.
Its NII in the fourth quarter rose by 17.75 per cent to Rs 1,433 crore. The other income, including fees and commissions, rose by 20.21 per cent to Rs 785 crore for the quarter.
Its cost of deposits rose 6.07 per cent in Q4 from 5.57 per cent year ago, while its yield on advances declined to 9.72 per cent. The net interest margin (NIM) declined to 2.98 per cent from 3.24 per cent year ago.
BoI’s net profit for 2008-09 rose by 49.68 per cent to Rs 3,007 crore. Its NII for FY-09 was up by 41.26 per cent to Rs 4,711 crore. The other income improved by 44.17 per cent to Rs 3,052 crore. Deposits also grew by 26.46 per cent to Rs 1,89,708 crore at end of March 2009, while advances rose by 26.08 per cent to Rs 1,44,732 crore.
Dena sees flat growth
Dena Bank posted a flat growth in net profit at Rs 111.17 crore for the quarter ended March 2009 as against Rs 110.99 crore in January-March 2008 last year. Its net interest income grew by just 4.24 per cent to Rs 238.96 crore in Q4 from Rs 229.25 crore the same quarter a year ago.
Its net interest margins dropped by 62 basis points to 2.23 per cent for the fourth quarter from 2.85 per cent a year ago. Its non-interest income was down to Rs 140.04 crore from Rs 152.74 crore.
The net profit for 2008-09 rose by 17.47 per cent to Rs 422.66 crore from Rs 359.79 crore for 2007-08.
Dhanalakshmi’s net doubles
Dhanalakshmi Bank, the Kerala-based private sector bank, saw its profit rise to Rs 22.25 crore for the fourth quarter ended March 2009 from Rs 9.43 crore a year ago. Its NII rose to Rs 28.18 crore from Rs 24.89 crore in January-march 2008.
Its net profit for the year ended March 2009 rose to Rs 57.45 crore from Rs 28.46 crore in the previous year. Its non-interest income increased from Rs 42.03 crore to Rs 79.36 crore. Total deposits increased from Rs 3,608.42 crore to Rs 4,968.81 crore at end of on March 2009, while total advances moved up from Rs 2,163.73 crore to Rs 3,245.30 crore.
| LOSING INTEREST Results chart for four banks (Rupees in crore) | ||||||||
| Canara Bank | Bank of India | Dena Bank | Dhanalakshmi Bank | |||||
| Q4 09 | Q4 08 | Q4 09 | Q4 08 | Q4 09 | Q4 08 | Q4 09 | Q4 08 | |
| Net profit | 718.81 | 464.06 | 810.37 | 757.04 | 111.17 | 110.99 | 22.25 | 9.43 |
| NII | 1305.33 | 922.00 | 1434.10 | 1216.82 | 238.96 | 229.25 | 28.18 | 24.89 |
| Other income | 846.47 | 714.27 | 785.37 | 653.25 | 140.04 | 152.74 | 40.95 | 14.64 |
| NPA Gross | 2167.97 (1.56%) | 1272.62 (1.18%) | 2470.88 (1.71%) | 1930.92 (1.68%) | 620.77 (2.13%) | 572.60 (2.45%) | 64.43 (1.99%) | 63.21 (2.95%) |
| NPAs net | 1507.25 (1.09) | 899.03 (0.84%) | 628.21 (0.44%) | 591.98 (0.52%) | 313.38 (1.09%) | 215.43 (0.94%) | 28.24 (0.88%) | 18.56 (0.88%) |
| CAR | 14.10 | 13.25 | 13.01 | 12.04 | 12.07 | - | 15.38 | - |
SBH net down 7.48%
State Bank of Hyderabad, the largest among the six associate banks of State Bank of India, reported a 7.48 per cent drop in net profit to Rs 172.29 crore for the quarter ended March 31, 2009, compared with Rs 186.23 crore in the year-ago period. Interest income during the quarter increased 18.46 per cent to Rs 1,487.04 crore from Rs 1,255.21 crore in the corresponding period last year.
