Public sector lender Indian Bank on Wednesday reported a 42 per cent decline in its net profit to Rs 984 crore for the quarter ended March 2022, after changing the deferred tax asset calculation on an annualized to quarterly basis.
In the previous quarter, the bank had a net profit of Rs 1,709 crore, which included Rs 913 crore in deferred tax assets (DTA) for the entire FY21.
“Until last fiscal year (FY21), we adjusted the DTA on an annual basis. Thus, the entire DTA adjustment was credited to 4 FY21 and the profit was Rs 1,709 crore (4 FY21). The bank changed its policy in June 2021 and we are now adjusting on a pro-rata basis every quarter, ”said SL Jain, Managing Director and CEO, Bank of India.
For the full financial year 2021-22, PAT FY21 rose 31 per cent to Rs 3,945 crore from Rs 3,005 crore.
Net interest income (NII) rose 28 per cent to Rs 4,255 crore from a year ago.
Its internal net interest margin (NIM) stood at 2.87 percent in Q4 FY22 compared to 2.34 percent in the same quarter last year.
The bank’s asset quality has improved, with Gross Non-Performing Assets (GNPA) falling 138 basis points (bps) a year to 8.47 percent from 9.85 percent. Net NPA decreased by 110 bps from 3.37 percent to 2.27 percent.
The provision coverage ratio stands at 87.38 percent.
Provisions and accessories increased to Rs 1,913.89 crore in Q4 FY22 as against Rs 1,589.71 crore.
The total recovery in the quarter was Rs 2,809 crore and for the full year it was Rs 7,115 crore.
The bank expects to recover about Rs 7,100 crore in FY23
Fresh slips stood at Rs 3,298 crore in Q4, including Rs 851 crore from Future Retail Limited loan accounts.
The capital adequacy ratio was 16.53 percent. The Common Equity Tier (CET) rose 126 bps a year to 12.53 percent. Tier I capital increased by 123 bps to 13.17 percent.
Jain said good capital is made to take care of lender growth. However, it has a board-approved arrangement to raise Rs 4,000 crore in equity.
Advance in FY22 increased by 6% to Rs 4,15,625 crore from Rs 3,90,317 crore in FY21. RAM (retail, agriculture and MSME) loans increased by 11 per cent to Rs 2,42,700 crore in March 2022 from Rs 2,18,942 crore in March 2021.
The bank is aiming for an 8-10 per cent credit growth in FY23, Jain added.
Deposits also increased by 10 per cent to Rs 5,93,618 crore in March 2022.
The bank’s scrip fell 3.20 per cent to close at Rs 143.80 on the BSE.