Dena Bank net jumps 42% on higher interest income
   
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Dena Bank net jumps 42% on higher interest income

Last Updated: Friday, July 27, 2012, 23:22
 
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Dena Bank net jumps 42% on higher interest income
Mumbai: State-run mid-sized lender Dena Bank Friday posted a healthy 42 percent increase in June quarter net profit at Rs 238.63 crore on the back of an improvement in all the core indicators.

The city-based bank had posted a post tax profit of Rs 168.09 crore in the corresponding period last fiscal.

The bank's core net interest income was up 37.10 percent at Rs 612.24 crore for the reporting quarter while the non-interest income rose 13.91 percent to Rs 141.65 crore.

The good numbers are a result of an overall performance improvement, including growth in advances, widening of margins and profit from sale of securities, Chairperson and Managing Director Noopur Mitra told reporters.

However, the investors were not enthused by the numbers and the bank scrip shed 4.12 percent to close at Rs 87.30 on the BSE Friday against the 1.20 percent gain on the Sensex.

Dena Bank's net interest margin was up 0.16 percent over the year-ago period at 3.06 percent in spite of a heavy 4 percentage point dip in the share of the low-cost current and saving account deposits, which stood at a little over 30 percent as of end June, in the wake of bank's shift to term deposits.

Acting on a finance ministry diktat of reducing reliance on bulk deposits, the bank has embarked on a three- quarter, Rs 9,000-crore shedding drive which will take the component down to 10 percent from the present 13.5 percent, Mitra said.

Profit from sale of securities went up to Rs 32.04 crore as against Rs 1.38 crore in the previous on an improvement in financial markets.

On the asset quality front, the net non-performing assets ratio improved to 1.01 from 1.08 percent.

The bank restructured Rs 800 crore of its assets during the quarter, which included two power distribution companies with Rs 700 crore, but Mitra stressed that there are no chunky restructurings in the pipeline which will erode profits.

The bank's total provisions nearly doubled to Rs 103.41 crore as against Rs 65.49 crore in the corresponding period last year.

PTI



First Published: Friday, July 27, 2012, 23:22


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