State Bank of Mysore net up 13% at Rs 96 crore in Q3

The total income of the bank has increased 9.1 per cent to Rs 1,888 crore

Bengaluru-based public sector lender State Bank of Mysore (SBM), an affiliate bank of State Bank group, reported 13 per cent rise net profit at Rs 96 crore for the third quarter ended December 2014, compared with Rs 85 crore in the corresponding quarter last year.

Total income of the bank increased 9.1 per cent to Rs 1,888 crore, compared with Rs 1,730 crore in the same quarter last financial year. Operating profit too increased 12.6 per cent to Rs 278 crore as against Rs 247 crore in the year-ago quarter.

The rise in profits was aided by a 6.7 per cent growth in the net interest income (NII) at Rs 493 crore, as against Rs 462 crore in the December quarter of 2013-14. Lower provisions towards non-performing assets (NPAs) also helped it post a rise in profit. The bank has provided Rs 101 crore towards the NPAs.

“During this quarter, our fresh slippages were brought down to Rs 421 crore compared to Rs 573 crore in the same quarter last year. Also, our net NPA increase has been only Rs 65 crore after upgradation and recovery of Rs 356 crore. Hence, our provisions were lower this quarter,” Sharad Sharma, managing director, SBM said.

The bank has launched a one-time settlement (OTS) scheme for small value loans with a ticket size of up to Rs 10 lakh, which helped the bank to recover outstanding loans, he said.

During the quarter, the cost of deposits went up by five basis points year on year to 7.28 per cent, while the yield on advances increased by 20 basis points to 11.10 per cent.

SBM’s capital adequacy ratio during the third quarter improved to 11.65 per cent from 11.19 per cent under Basel-III norms. The tier-I capital stood at 8.34 per cent. Its return on assets marginally improved to 0.51 per cent from 0.49 per cent. However, the bank has done well in reducing net NPAs to 3.11 per cent from 4.21 per cent in the year-ago quarter.

The provision coverage ratio to gross NPAs of the bank as on December 2014 stood at 62.08 per cent as against 55 per cent in the year ago period.

The bank’s stock closed 1.59 per cent lower at Rs 571.70 per share on the close of trading on BSE.