IDBI Bank is all set to announce a net profit in the range of Rs 3.5 crore to Rs 4 crore for the year ended March 31, 1997. The results will be finalised at the board meeting of the bank to be held on June 23. The bank is expected to post an operational profit of Rs 16 crore for the same period and after making provision for preliminary expenses the pre-tax profit is likely to be around Rs 8 crore. The bank targets a Rs 20-crore pre-tax profit for 1997-98.
It has an non-performing assets (NPA) to the tune of Rs 2.5 crore which amounts to 0.5 per cent of the outstanding advances. While the bank has an export credit exposure to the extent of 13 per cent, the bank has not been able to meet the priority sector requirements which is being met by investments in Nabard and Sidbi.
At the end of the financial year 1996-97, the bank has garnered deposits exceeding Rs 500 crore and has outstanding advances to the tune of Rs 530 crore. The credit deposit ratio of the bank is 1.06. For the year ahead the bank has drawn plans to have outstanding advances of Rs 1,000 crore.
It will be offering differing modes in assessing a corporate with emphasis on cash budgeting method. The bank has also been lending against shares at 50 per ce margins.
IDBI Bank will be the conduit for the parent Industrial Development Bank of India (IDBI) which has drawn up plans for disbursing Rs 2,500 crore for working capital financing. These funds will be routed through IDBI Bank where it has a presence.
The bank is in the process of expanding its branch network and expects 25 branches by the end of
March 1998. The margins of the bank are expected to come under pressure after the latest round of interest cuts and also the overall liquidity situation. While the bank officials are quite confident of meeting their deposits target, they are unsure on the advances front.
