Dena Bank Q2 profit up 24% at Rs 239.64 crore
Mumbai: Public sector Dena Bank Tuesday reported a 23.79 percent rise in net profit to Rs 239.64 crore in the second quarter ended September 30 on the back of an increase in core income and improvement in asset quality.
The state-owned bank had a net profit of Rs 193.58 crore in the July-September period of the previous fiscal.
The company's total income rose 33.23 percent to Rs 2,327.84 crore from Rs 1,747.19 crore a year ago.
"Our profit has risen as performing assets have done good during the period," Dena Bank Chairperson and MD Nupur Mitra told reporters here.
The key net interest income (NII) increased around 15 percent to Rs 594 crore in Q2 compared to Rs 515 crore. Net interest margin (NIM), however, came under pressure and stood at 2.86 percent, down from 3.22 percent a year ago.
"Margins declined because of rationalisation of rates in specific loan segments like SMEs and retail," she said, adding the bank is hopeful of maintaining its NIM at 3 percent in the current financial year.
On credit and deposit front, the bank's advances grew by 37.83 percent to Rs 59,406 crore and deposits by 30 percent to around Rs 83,600 crore in the second quarter.
"Given the economic environment, we hope for a credit growth of 18 percent and deposit growth of 17 percent in the full year," Mitra said.
The bank saw a marginal rise in non-performing assets (NPA) in second quarter. While gross NPA rose to 1.97 percent from 1.93 percent a year earlier, net NPA inched up to 1.22 percent from 1.15 percent in the same period last fiscal.
"We hope to maintain the gross NPA below 2 percent and net NPA at 1 percent this financial year," Mitra said.
The bank said it restructured loans of around Rs 300 crore during the reporting quarter.
"Restructuring pipeline is not a concern for us as a maximum of Rs 160 crore of loans may be restructured in the rest of the fiscal," she said.
The bank, which has a current account, savings account ratio of 31.86 percent, had a capital adequacy ratio of 12.05 percent at the end of September.
"We have requested for Rs 600-crore recapitalisation from Government to boost capital adequacy ratio and support business growth," Executive Director A K Dutt said.