The J&K Bank recorded a net profit of Rs 59.80 crore in Q4 FY2007-08, an increase of 32% over the corresponding period of the previous year. The bank's operating profits were up by 38% at Rs 202.91 crore for the fourth quarter ended 31 March 2008 as compared with Q4 of 2006-07. On annual basis, the Bank, which continued to increase its presence in SME, retail and micro-finance lending, posted a net profit of Rs. 360.00 crore as against 274.49 crore in the year ended March, 2007. The total business turnover increased to Rs 47,475.87 crore in 2007-08, an increase of 12% over the previous fiscal. The Loan Book as on March 31, 2008 stood at Rs.18883 crore up 10.55% from last year's Rs.17080 crore. Due to the volume growth in Advances and improvement in yields from 8.58% for FY 2006-07 to 10.44% for the current fiscal, the interest income on advances went up significantly by 38.70% over the pervious year. As on March, 2008 banks deposit base stood at Rs.28593 crore from Rs.25194 crore a year back registering an increase of 13.5%. There has been significant accretion to the bank, in its low cost deposits portfolio during this period, which has resulted in improving CASA ratio to 39.16% as against 37.02% of the previous fiscal. Despite increase in Interest expenses by 43.51%, attributed to rising cost of deposits, bank has been able to protect its margins due to the concurrent increase in the lending rates. Operating Income (Net Interest Income + Other Income) was Rs. 1055.45 Crore for the year ended March 31, 2008 as against Rs. 928.06 Crores for the year ended March 31, 2007 registering an increase of 13.73%. Other Income of the Bank has increased from Rs.160.21 Cores for the year ended March, 2007 to Rs.245.01 Crore for the year ended March 31, 2008, registering an increase of 53%. As a results of steps taken by the Bank to increase other income, the ratio of other income to total income of the Bank has increased to 9.14% from 7.78% a year ago. As a result of good recoveries and minimal slippages reported during the year provisioning on account of bad and doubtful debts, reduced by 58% to Rs. 30 crore as against Rs. 71.57 crore a year back. As a result the provision cover has marginally come down to 58.05% (61.43% a year back). The Bank has ended the financial year with NPA at 1.08% compared to 1.13% as at end of preceding year. There has been improved productivity during the year. Business per employee and profit per employee has increased to Rs. 628 Lakhs and Rs. 4.76 Lakhs respectively. Return on assets improved to 1.10% from 0.96% during the previous year. The cost to income ratio has decreased to 38.24% from 40.13%. The Capital Adequacy Ratio stands at 12.80% at the end of March 31, 2008 and Tier I capital amounted to 12.14%. Net Worth of the Bank stood at Rs. 2308.93 Crores as at end of the financial year as compared to Rs. 2008.73 Crores a year earlier, a growth of 14.95%. The Bank intends to augment its capital in the current financial year through proposed London Listed GDR Issue and Bank has already made allotment of 40,92,140 convertible warrants on preferential basis to the State Govt of Jammu and Kashmir to enable the State Govt. to retain its majority stake in the bank consequent upon the said GDR Issue. The Board of Directors has recommended a dividend of 155% (Rs 15.50 per share). On the basis of Dividend recommended, the Dividend pay out ratio works out to 21%.

(Rs. in Crore)

	FY 2007-08	FY 2006-07	Percentage change
Net profit	360.00	274.49	31.15%
Net Interest Margins	2.95%	2.97%	-
Operating Income	1055.45	928.06	13.73%
Net interest income	810.44	767.85	5.55%
Fee based income	245.01	160.21	52.93%
Operating Profit	651.84	555.62	17.32%
Deposits	28593	25194	13.49%
Return on Assets (%)	1.10	0.96	14.58%
Post Tax Return on Equity (%)	16.68	14.42	15.67%
Earnings per Share	74.26	56.62	31.16%
CRAR                                     Tier – I                                     Tier – II	12.80% 12.14% 0.66%	13.24% 12.60% 0.64%	-

For more information, please contact:
Mr. Parvez Ahmed
President & Company Secretary
The Jammu & Kashmir Bank Ltd.
+91 194 248 1927/28
parvazahmad@jkbmail.com
parvez.ahd@gmail.com