Vijaya Bank net up 21 percent in first quarter

Bangalore, July 22 (IANS) State-run Vijaya Bank reported a 21 percent rise in net profit at Rs.174 crore for the first quarter (April-June) of this fiscal (2010-11) as against Rs.144 crore in like period of previous fiscal (2009-10).

‘Our core earnings continue to show improvement despite a slackened pace of business in the first quarter. Operating profit shot up 50 percent year on year (YoY) to Rs.315 crore on 48 percent YoY growth in net interest income (NII) during the quarter under review,’ Chairman and Managing Director Albert Tauro told reporters here.

Similarly, the bank’s net interest margin (NIM) increased by 57 basis points to 2.9 percent from 2.33 percent year ago, while return on assets improved fractionally to 0.96 percent from 0.93 percent a year ago.

‘Cost of deposits declined by 128 basis points to 5.54 percent from 6.82 percent year ago, while yield on advances improved to 10.72 percent from 9.84 percent in the like period,’ Tauro said.

Total income, however, increased by mere four percent YoY to Rs.1,520 crore from Rs.1,463 crore as trading profit from treasury operations (trading profit) declined to Rs.170 crore from Rs.203 crore year ago and non-interest income dipped to Rs.11 crore from Rs.21 crore.

‘We have lowered expenses during the quarter under review to Rs.121 crore from Rs.125 crore year ago,’ Tauro noted.

The total business increased 14 percent YoY to Rs.104,621 crore, with deposits growing 14 percent to Rs.62,673 crore and advances 13 percent YoY to Rs.41,948 crore during the quarter.

‘We are targeting a total business of Rs.126,000 crore for this fiscal (FY 2011), envisaging 21 percent YoY growth,’ Tauro added.

The bank’s gross non-performing assets (NPA) declined to 2.32 percent from 2.94 percent YoY and net NPA to 1.35 percent from 1.58 percent YoY.

The bank’s capital adequacy ratio (CAR) stood at 14.74 percent as against 13.34 percent as a result of the government subscribing to perpetual non-cumulative preference shares to the tune of Rs.700 crore during the quarter.

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