Sbh Bottomline Rises 14.6%

State Bank of Hyderabad (SBH) has improved its operating profit by 51 per cent to Rs 411 crore, but due an increase of 129 per cent in provision for taxation, the net profit went up by only 14.60 per cent to Rs 127.81 crore.

SBH's managing director C K Mehrotra, pointed out that the bank could be the highest tax payer in the state this year.

Stating that SBH does not need any money as its capital adequacy ratio is at a comfortable 11 per cent, he said that there is no urgency for a public issue.

He added that he has requested the government to split the share which presently has a face value of Rs 100. Otherwise, the book value of nearly Rs 3,500 will be too high to approach the capital markets, he said.

 

Mehrotra said despite the competition getting tougher with new players having the advantage of technology and freedom from past burdens, SBH has been able to increase its presence in personal segment.

He said out of the deposit growth of 18 per cent, half of it came from this segment lowering its cost of funds.

The non-performing assets (NPAs) have come down to 7.30 per cent of SBH's net advances, from 8.78 per cent in the previous year. In the year ending March 31, 1998 it was at hefty 11.93 per cent.

Talking about the social banking, he said that while it has been made out to be a hindrance it is not necessarily conflicting with the profitability of banks. We have fulfilled our social obligations and yet improve our profits, he added.

As against the benchmark of 40 per cent, SBH has increased its priority sector lending to Rs 2475 crore amounting to 43.05 per cent. In percentage terms too it has been an improvement on 40.59 per cent in the previous year.

He said that disbursements to agriculture sector increased by 25.32 per cent to Rs 511 crore, taking the outstanding advance to Rs 985 crore from Rs 851 crore. SBH he said has issued over 62,000 Kisan credit cards from 200 branches and that all the four regional rural banks sponsored by it are earning profits.

Stating that through 236 branches, 60 per cent of the bank business has been computerised, he stated that he is confident of reaching the benchmark of 70 per cent by the end of the year.