Amalgamation of Allahabad Bank
into Indian Bank came into effect on April 1, 2020. Accordingly, the combined financials as on September 30, 2019 and March 31, 2020 have been arrived at by aggregation of audited numbers of combined figures of two banks.
The lender recorded 40 per cent growth in operating profit and CASA (current account, savings account) by a healthy 41%. Its net interest margin (NIM), at 3.06%, has grown by 23 bps over the last quarter.
The bank's exposure to RAM (retail, agriculture and MSME) grew by 5 per cent and now is at 55 per cent of advances.
Net interest income (interest income less interest expenditure, or NII) was up 32 per cent in Q2FY21 to Rs 4,144 crore, from Rs 3,139 crore for Q2FY20. On a sequential basis it rose seven per cent.
Domestic NIM increased by 39 bps to touch 3.06 per cent in Q2FY21, from 2.67 per cent a year ago. On a sequential basis it increased by 23 bps from 2.83 per cent to 3.06 per cent.
Non-interest income for the quarter ended Q2FY21 was Rs 1,611 crore, up 29 per cent over Q2FY20, mainly on the back of fees earned, forex income, recovery of bad debts and treasury income. On a sequential basis it rose 21 per cent.
Provisions & Contingencies for Q2FY21 stood at Rs 2,583 crore as against Rs 3,890 crore for the corresponding quarter of previous year. Specific loan loss provisions for Q2FY21 were Rs 1,880 crore, majority being ageing provision, compared to Rs 3,443 crore in Q2 FY20. On a sequential basis Total Provisions increased by 8%.
Total balance sheet size grew by 7.75 per cent (YoY) to Rs 5,84,880 crore as of Q2FY21 from Rs 5,42,807 crore a year ago. Sequentially, it was up 1.58 per cent.
Chunduru said despite covid challenges credit increased and the Bank expects to report around 8-10 per cent growth during the current fiscal.
GNPA dropped to Rs 36,223.13 crore from 39,990.06 crore in first quarter and Rs 14,010.69 crore, a year ago. Net NPA stood at Rs 10,052.21 crore during the second quarter as compared to Rs 12,754.73 crore in Q1 and Rs 6613.47 crore, a year ago.
Gross non-performing assets were at 9.89% of Gross advances as on Q2FY21 brought down by 275 bps from 12.64 per cent as on Q2FY20. On a sequential basis it decreased by 101 bps. Net non-performing assets came down to 2.96 per cent as on Q2FY21 from 4.59 per cent of Net advances as on Q2FY20 with a reduction of 163 bps. On a sequential basis it decreased by 80 bps. Recovery of Bad debts improved by 38% during Q2 FY21 over Q2 FY20.
The lender's total Capital Adequacy Ratio (CRAR) as per Basel III guidelines was healthy at 13.64 per cent as at Q2FY21 vs 13.45 per cent as of Q1, as against a regulatory requirement of 10.875 per cent.