14th July 2009
Srinagar
J&K Bank Q1 net profit Rs 117 crores Operating Profit up 41 % to Rs 256 crore
While registering a business turnover of Rs 51,975.56 crore during the quarter ended June, 2009, the J&K Bank recorded an increase of 41 per cent over the corresponding period of the previous year in the operating profit which increased to Rs.256 crore. For the said quarter, the Bank recorded a net profit of Rs 117.05 crore, an increase of 24 % over Rs 94.56 pertaining to the corresponding period of the previous year.
The bank announced the un-audited financial results for the quarter ended June 2009, following the approval of its Board of Directors in a meeting held here today.
"The financial results of Q1 speak our performance despite adverse market conditions prevailing in the J&K state. In fact, the growing profits vet our renewed strategy where we have focussed on J&K state and our investment strategy in a declining interest rate scenario," said Dr. Haseeb A Drabu, Chairman and Chief Executive of the Bank, while commenting on the performance of the bank. He further stated that the bank has leveraged technology to maximize efficiency in the system and also to bring down the operating expenses.
The Gross NPAs and the Net NPAs as proportion of Gross and Net Customer Assets for the quarter ended June, 2009 were at 2.44 % and 0.77 % respectively. The NPA Coverage Ratio, which is an indicator of safety and shows the level of provision a bank has for its bad assets, has gone up to 68.79 % from 59.53 % a year ago. It is now amongst the highest in the industry. As a result of efficient leveraging of its assets, the Bank has been able to bring down its Cost to Income ratio to 32.79 % from 37.66 % a year ago. The Return on Assets has improved to 1.29 % (annualized) compared to 1.16 % a year ago.
Dr. Drabu cited productization of financial services, where the bank has tailored a wide range of products to suit various sectors of economy, be it agriculture, horticulture, artisan or industries sector, as a major contributing factor for the healthy performance of the Bank. "This initiative has resulted in tapping the unexplored areas of our economy and enhanced our outreach to unbanked areas in the state", he emphasized.
"Due to improvement in yield on advances from 10.37 % in Q1 FY 2008-09 to 11.55 % for the current quarter, the interest income on advances went up by 19 % on a Y on Y basis. Despite increase in Interest expenses by 20 % Y on Y, attributed to rising cost of deposits, bank has been able to maintain its margins at 3.10 % due to a concurrent increase in the lending rates, " said Dr. Drabu.
Operating Income (Net Interest Income plus Other Income) stood at Rs. 381.67 crore for the quarter ended June 30, 2009 as against Rs. 291.13 crore for the corresponding quarter of last fiscal registering an increase of 31 %. The Other Income of the Bank has gone up by 78 % to Rs. 115.68 crore from Rs 64.88 crore a year ago, largely on account of trading income.
The Bank has restructured loans during the quarter to the extent of around Rs 100 crore mostly by way of realignment of interest rates.
The Capital Adequacy Ratio under the Basel I norms stands at 14.33 % at the end of June 30, 2009 and Tier I capital amounted to 13.63 %. Net Worth of the Bank stood at Rs. 2739.91 crore as on June 30, 2009 compared to Rs. 2403.49 crore a year earlier, registering a growth of 14 %.
The bank announced the un-audited financial results for the quarter ended June 2009, following the approval of its Board of Directors in a meeting held here today.
"The financial results of Q1 speak our performance despite adverse market conditions prevailing in the J&K state. In fact, the growing profits vet our renewed strategy where we have focussed on J&K state and our investment strategy in a declining interest rate scenario," said Dr. Haseeb A Drabu, Chairman and Chief Executive of the Bank, while commenting on the performance of the bank. He further stated that the bank has leveraged technology to maximize efficiency in the system and also to bring down the operating expenses.
The Gross NPAs and the Net NPAs as proportion of Gross and Net Customer Assets for the quarter ended June, 2009 were at 2.44 % and 0.77 % respectively. The NPA Coverage Ratio, which is an indicator of safety and shows the level of provision a bank has for its bad assets, has gone up to 68.79 % from 59.53 % a year ago. It is now amongst the highest in the industry. As a result of efficient leveraging of its assets, the Bank has been able to bring down its Cost to Income ratio to 32.79 % from 37.66 % a year ago. The Return on Assets has improved to 1.29 % (annualized) compared to 1.16 % a year ago.
Dr. Drabu cited productization of financial services, where the bank has tailored a wide range of products to suit various sectors of economy, be it agriculture, horticulture, artisan or industries sector, as a major contributing factor for the healthy performance of the Bank. "This initiative has resulted in tapping the unexplored areas of our economy and enhanced our outreach to unbanked areas in the state", he emphasized.
"Due to improvement in yield on advances from 10.37 % in Q1 FY 2008-09 to 11.55 % for the current quarter, the interest income on advances went up by 19 % on a Y on Y basis. Despite increase in Interest expenses by 20 % Y on Y, attributed to rising cost of deposits, bank has been able to maintain its margins at 3.10 % due to a concurrent increase in the lending rates, " said Dr. Drabu.
Operating Income (Net Interest Income plus Other Income) stood at Rs. 381.67 crore for the quarter ended June 30, 2009 as against Rs. 291.13 crore for the corresponding quarter of last fiscal registering an increase of 31 %. The Other Income of the Bank has gone up by 78 % to Rs. 115.68 crore from Rs 64.88 crore a year ago, largely on account of trading income.
The Bank has restructured loans during the quarter to the extent of around Rs 100 crore mostly by way of realignment of interest rates.
The Capital Adequacy Ratio under the Basel I norms stands at 14.33 % at the end of June 30, 2009 and Tier I capital amounted to 13.63 %. Net Worth of the Bank stood at Rs. 2739.91 crore as on June 30, 2009 compared to Rs. 2403.49 crore a year earlier, registering a growth of 14 %.