BoI net profit doubles in 3rd quarter

The improvement in interest margins, sale of equity, recoveries and commissions helped Bank of India (BoI)to post a 101 per cent growth in is net profit for the third quarter ended December 2007 at Rs 512 crore as against Rs 255 crore in same period last year.

Total income in the quarter grew to Rs 3,705.2 crore from Rs 2,641 crore a year ago. Net interest income rose by 26 per cent from Rs 859 crore to Rs 1,079 crore during the period. Net interest margins moved up from 2.97 per cent to 3.14 per cent.

"While bank will endeavour to maintain NIMs, it is a challenging task to sustain these levels when the business volume is growing," Chairman and Managing Director T S Narayanasami said. 
 

Performance in quarter ended December
In Rs crore	2006	2007	%chg
Interest earned	2318.70	3151.11	35.90
Other income	322.31	554.10	71.92
Expenditure	2087.85	2733.85	30.94
PBT	553.16	971.36	75.60
Net profit	254.87	511.89	100.84
CAR (%)	11.76	12.54	-

Total non-interest income comprising heads like sale of securities and recoveries among grew by 72 per cent to Rs 554 crore. The profit from sale of securities grew to Rs 116 crore from Rs 55 crore. The recoveries from written-off accounts jumped to Rs 75 crore from Rs 15 crore a year ago.

The deposits rose by 27.4 per cent to Rs 1,35,835 crore. The share of low cost deposits (savings and current account) dipped to 37 per cent as against 41 per cent in the year-ago period.

"It is difficult to maintain share of low cost deposits when business is growing (read competition among banks to raise resources)," CMD said. The cost of funds rose to 5.24 per cent from 4.41 per cent.

The advances grew by 29.86 per cent to Rs 1,03,656 crore at the end of December 2007. The yield on advances went up from 8.43 per cent to 9.58 per cent.

On the impact of present market turmoil on the proposed Qualified Institutional Placement (QIP) to raise about Rs 1,400 crore, Narayanasami said, "We will wait and watch. Let the market get settled. We are looking for fair price. It (QIP) will be done hopefully by the end of February."