Oriental Bank of Commerce Q1 profit up 3% to Rs 365 cr

The bank had posted a net profit of Rs 353.38 crore in the first quarter a year earlier

Oriental Bank of Commerce (OBC) today reported a marginal 3.16% rise in net profit to Rs 364.54 crore in the first quarter ended June 30 as provisioning against bad loans increased.

The public sector bank had posted a net profit of Rs 353.38 crore in the first quarter a year earlier.

Total income increased 6.09% to Rs 5,576.03 crore from Rs 5,255.70 crore in the corresponding year-ago period, OBC Chairman and Managing Director S L Bansal said.

"Net profit has been flat because of increase in provisions compared to the same period of the last fiscal," he said.

Total provisions rose to Rs 774 crore against Rs 734.89 crore in the same period of the previous fiscal. Provision for bad loans increased sharply to Rs 478 crore as against Rs 345 crore in the same period a year ago.

Gross non-performing assets (NPAs) as a percentage of total advances rose to 4.33% from 3.36%. Net NPAs went up to 3.11% from 2.34%.

The net interest income also declined by 5% to Rs 1,243 crore, compared with Rs 1,307 crore in the same period a year ago.

The bank's net interest margin declined to 2.56% at the end of the first quarter from 2.9% in June 2013.

Bansal said the bank has requested the government for Rs 500 crore capital infusion.

The government last fiscal infused Rs 150 crore in the bank to enhance capital base.

Total business as of June 30 stood at Rs 3,24,861 crore from Rs 3,04,269 crore at end of the first quarter in the previous fiscal, a growth of 6.77%.

OBC recorded a credit growth of 8% to Rs 1.38 lakh crore, while deposits grew 5.83% Rs 1.86 lakh crore at the end of the first quarter.

The bank expects credit and deposit growth of 12% during the entire fiscal, Bansal said.

Shares of the bank closed at Rs 282.35, up 0.36% on the BSE.