Kotak Bank net rises 27%

Robust growth in advances and reduction in provisions have helped Kotak Mahindra Bank post a 27 per cent rise in its consolidated net profit for the first quarter ended June 2010 at Rs 328 crore, as against Rs 257 crore in the corresponding period last year.

The net profit, on standalone basis, grew by 107 per cent to Rs 187 crore.

The good growth in advances and substantial decline in provisions for bad loans (non-performing assets) contributed to growth in net profit, its group chief financial officer Jaimin Bhatt said.

The total income (consolidated) for the reporting quarter stood at Rs 2,326.51 crore as against Rs 2,338.18 crore in the same period last year.

Bhatt said the net interest margin (NIM) was down to 5.7 per cent from 6.1 per cent a year ago. The decline in NIM is result of change in business mix. The share of the corporate segment has gone up.

Indicating uptick in credit demand, advances rose by 42 per cent to Rs 32,978 crore at end of June 2010. Total assets managed/advised by the group as on June 30 were Rs 47,979 crore, up from Rs 45,224 crore at end of March 2010.

The capital adequacy ratio (CAR) as per Basel-II as on June 30 is 16.9 per cent. The Tier-I CAR was 15.2 per cent. On standalone basis, CAR was 16.8 per cent at end of June 2010.

On a standalone basis, net interest income grew 24 per cent to Rs 508 crore from Rs 409 crore in April-June 2009. Fee income grew to Rs 63 crore from Rs 57 crore in the same quarter last year. Deposits grew by 38 per cent to Rs 24,058 crore as against Rs 17,459 crore at the end of June 2009. The share of low cost deposits – current account and savings account - was 28 per cent of total deposits, the same level at end of June 2009. Net NPAs almost halved to 0.99 per cent from 1.98 per cent year ago.