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State-owned Oriental Bank of Commerce (OBC) on Wednesday reported 16 per cent increase in net profit at Rs 291 crore for the quarter ended September, on account of a rise in fee income.
The net profit was Rs 251 crore in the same quarter last financial year.
The figure has gone up primarily due to rise in non-interest income and good recovery, Executive Director Bhupinder Nayyar told reporters here.
Gross non-performing assets (NPAs) as a percentage of total advances rose to 4.74 per cent from 3.77 per cent in the same quarter a year ago.
Net NPAs went up to 3.29 per cent from 2.69 per cent at the end of September 2013.
Asset quality remains a challenge and the bank is making all efforts to contain it, he said.
OBC shares closed 4.30 per cent down at Rs 266.85 on the BSE.
The non-interest income of the bank rose 25.90 per cent to Rs 392.64 crore as compared to Rs 311.87 crore in the second quarter of the previous fiscal.
During the quarter, the bank made a recovery of Rs 339 crore as against Rs 314 crore in the same period a year ago.
Fresh slippages to NPA were, however, contained at Rs 978 crore as compared to Rs 1,041 crore in the same quarter a year ago.
Total income increased by 6.83 per cent to Rs 5,328.56 crore from Rs 4,987.71 crore in the same period last year.
The bank's provisions and contingencies during the quarter rose to Rs 641.19 crore as compared Rs 550.52 crore in the same quarter of the previous fiscal.
During the quarter, operating profit rose by 3.5 per cent to Rs 854.86 crore from Rs 825.08 crore in the same period of the previous fiscal.
The bank is aiming at net interest margin (NIM) of 2.6 per cent for the entire fiscal, he said.
During the first half of 2013-14, the bank registered 8.4 per cent rise in net profit to Rs 655.96 crore as compared to Rs 604.79 crore in the same period a year ago.
Last fiscal, the bank had recorded a net profit of Rs 1,139.41 crore.
The bank reported a total income of Rs 10,904.60 crore in the first six months as compared to Rs 10,243.41 crore in the same period of previous financial year.
Total business of the bank as on September 30 stood at Rs 3,26,690 crore from Rs 3,04,919 crore at end of second quarter of previous fiscal, registering a growth of 7.14 per cent.
Capital Adequacy Ratio (CAR) of the bank stood at 10.88 per cent at the end of second quarter, in line with Basel III norms.
