IndusInd net profit up 65%

BANKING SCORECARD

IndusInd Bank's net profit increased by 65 per cent to Rs 13.22 crore in the first quarter of 2007-08 as advances to companies grew and on a drop in cost of deposits. Total income in the quarter ended June 30, 2007 increased 31 per cent to Rs 495.60 crore from Rs 380.09 crore a year earlier.

The bank's net interest margin has dipped to 1.12 per cent from 1.22 per cent. "The high cost of term deposits acquired at the end of the year has spilled over to March ,'' said Bhaskar Ghose, managing director.

The bank's yield on advances for April to June 2007 was at 11.16 per cent compared with 9.09 per cent. ``As interest rates on deposits increased, on the credit side we still continue to carry low interest rate loans as almost 60 per cent of the portfolio is commercial vehicle loans and these loans are fixed rate loans. However, the yield on advances is expected to improve further on account of continuous repricing,'' added Ghose.

The advances portfolio has grown by a modest 6 per cent to Rs 11,469.28 crore against Rs 10,809 crore. The bank has added deposits of about Rs 2,000 crore in the first quarter at Rs 17,328.98 crore as against Rs 15,400 crore.

The bank's non performing assets and capital adequacy stood at 2.50 per cent and 12.16 per cent. The bank is planning to raise around Rs 350 crore of capital through the issuance of upper tier II bonds in the current financial year.