Federal Bank Q2 net up 5% to Rs 226 cr; stock jumps 10%

Net profit was at Rs 215.10 crore during the same period of previous fiscal.

Mumbai: Kerala-based private sector lender Federal Bank on Monday reported a modest 5 percent rise in its net profit at Rs 225.81 crore in the September quarter on a rise in core income and advances.

Net profit was at Rs 215.10 crore during the same period of previous fiscal.

Total income rose 11.58 percent to Rs 1,857.84 crore against Rs 1,665 crore reported in same period last fiscal.

Net interest income or core income grew 8.39 percent to Rs 548.35 crore during the period.

Meanwhile, the bank showed improvement in the asset quality front with gross NPA ratio improving to 3.39 percent from 3.83 percent.

However, net NPAs increased to 0.98 percent from 0.68 reported during the same period a year earlier.

As per the bank, fresh slippages during last quarter stood at Rs 151 crore with a restructuring of Rs 214 crore.

"We have no more pipeline of restructuring as of now," Managing Director and Chief Executive Shyam Srinivasan told reporters in a conference call from Kochi today.

Net interest margin stood at 3.30 percent. "We hope to maintain NIM at the current level in the future," Srinivasan said.

On the deposit front, the bank said it has increased 14.69 percent to Rs 56,793.74 crore by the end of the September quarter with sound uptick in NRI deposits. The cheap cost deposit base or CASA improved to 30.72 percent by the end of September quarter.

Similarly, advances grew by 16.31 percent to Rs 42,220 crore with sound growth in retail and SME credit.

Srinivasan also said the private sector lender has already raised around USD 70 million through the forex swap window opened by RBI last month and is likely to raise another USD 30-40 million by November end.

Federal Bank has a capital adequacy ratio of 15.35 percent with a tier-I capital of 14.64 percent for the period ending September.

Despite tepid numbers, the market lapped up the stock by 10 percent to Rs 78.40 on the BSE, which closed flat with a positive bias.