Kotak Bank profit up 7.5% to Rs 37cr

Kotak Mahindra Bank's net profit for the quarter ended March 31, 2007, rose by 7.5 per cent to Rs 37.3 crore against Rs 34.7 crore in the year-ago quarter. Profit for the full year ended March 31, 2007 increased by 19 per cent to Rs 141.4 crore against Rs 118.2 crore in FY06.

"The profit numbers is after considering provision on stressed assets portfolio acquired from other banks and non-banking finance company's Rs 4.6 crore, additional standard asset provisioning consequent to the change in RBI guidelines of Rs 31.2 crore and a provision of Rs 4.1 crore on account of liability for employee benefits in accordance with AS15,'' said Uday Kotak, executive vice-chairman and managing director. The board that met in Mumbai today announced a dividend of 7 per cent.

Consolidated net profit of the group increased by 30 per cent to Rs 170 crore in the quarter ended March 31, 2007, while it increased by 57 per cent to Rs 538.2 crore from Rs 342.5 crore for the full year ended March 2007.

"We continue to focus on building scale with value creation. We now have over 105 branches and by mid next year we would like to own 200 branches. The bank will also focus on building a strong corporate book with focus on maintaining a healthy net interest margin and asset quality. We will also expand our overseas presence in the Middle East,'' added Kotak.

The bank's net interest margin for the quarter is around 4.5 per cent and net non-performing assets at 0.18 per cent. Its capital adequacy ratio stands at 13.46 per cent.

Total income for the quarter stood at Rs 521.06 crore against Rs 293.44 crore, while other income also rose to Rs 874.6 crore from Rs 764.7 crore in the year-ago period.

"On the international business front, our asset management company is planning to launch a Shariah fund in the Middle East. We plan to launch funds across geographies, including Japan, with a partner,'' said C Jayaram, executive director, wealth management, Kotak Mahindra Bank.