The J&K Bank has posted an impressive Rs 94.56 crore net profit for the first quarter of the current financial year marking an increase of 14 per cent over the corresponding period of the previous year. The bank's operating profits have gone up by 38 per cent at Rs 181.50 crore, the bank in a statement said. Importantly, the bank has been able to withstand current adverse banking scenario, wherein almost all major banks of the country are posting negative or very little growth in their profits, it said. According to the statement the bank officials attribute this performance to the bank's strategy of lending more within the state. "The driver of this growth has been the new business strategy adopted by the bank, which envisages major focus on the State of Jammu and Kashmir. Under the new strategy, the aim of the bank is to increase lending in J&K, which is high margin low volume business. For this the bank has been developing JK specific products suiting the local small economies of the state," said Dr Haseeb A Drabu, chairman of the Bank. Dr. Drabu, according to the statement, said: "For us, new financial products come about because people in the economy find them useful. Our stream of new products have a common thread in their design and development and they fulfill the basic economic objectives of people in the local economy." The Board of Directors of the Bank approved the Bank's accounts for the quarter ended June 30, 2008 at its meeting held in Delhi today. Posting not only impressive profits, the bank has been able to considerably improve all its ratios indicative of the bank's efficient management. The Net Interest Margins of the Bank have improved to 3.09 per cent for the quarter ended June 30, 2008 as compared to 2.90 per cent for the corresponding quarter of the last fiscal. Breaking away from the Industry trend, cost of deposits of the bank has come down to 5.71 per cent for the quarter as compared to 5.93 per cent for Q1 of 2007-08. The total business turnover increased to Rs 48,579 crore in Q1 FY08-09, an increase of 15 per cent over the corresponding period of the previous year. The Loan Book as on June 30, 2008 stood at Rs 20075 crore up 15.70% from last year's Rs.17351 crore. Due to the volume growth in Advances and improvement in yields from 10.23% for Q1FY 2007-08 to 10.37% for the current quarter, the interest income on advances went up by 15% over the corresponding period of pervious year. As on June 30, 2008 bank's deposit base stood at Rs.28504 crore from Rs.24744 crore a year back registering an increase of 15.2%. There has been significant accretion of more than Rs. 2200 cr to the bank, in its low cost deposits portfolio during this period, which has resulted in improving CASA ratio to 38.88% as against 35.83% of corresponding period of the previous fiscal. Operating Income (Net Interest Income + Other Income) was Rs 291.13 crore for the quarter ended June 30, 2008 as against Rs. 225.43 crore for the quarter ended June 30, 2007 registering an increase of 29.14%. Other Income of the Bank has increased from Rs.35.82 crore for the quarter ended June, 2007 to Rs. 64.88 crore for the quarter ended June 30, 2008, registering an increase of 81.13%. As a result of steps taken by the Bank to increase other income, the ratio of other income to total income of the Bank has increased to 9.06% from 5.86% a year ago. There has been improved productivity during the period under review. Business per employee and profit per employee has increased to Rs. 644 lakh and Rs. 5.01 lakh respectively. Business per Branch and profit per Branch has increased to Rs. 94.70 crore and Rs. 73.73 lakh respectively. The cost to income ratio has decreased to 37.66% from 41.81%. The Capital Adequacy Ratio stands at 12.20% at the end of June 30, 2008 out of which Tier I capital amounted to 11.59%. Net worth of the Bank as on 30th June, 2008 stood at Rs. 2403.48 crore as compared to Rs. 2091.97 crore as on 30th June, 2007.