Kotak Mahindra Bank consolidated Q1 net up 23%

Private lender Kotak Mahindra Bank reported a 23 per cent rise in its June 2019 quarter (Q1) consolidated net profit on account of higher net interest income.

Profit after tax at the consolidated level rose to Rs 1,932 crore in the first quarter of 2019-20 from Rs 1,574 crore in the year-ago period (Q1FY19).

Total consolidated income went up 22.5 per cent year-on-year (YoY) to Rs 12,130 crore, said the bank in a filing to the stock exchanges on Tuesday.

At the standalone level, the bank reported a 33 per cent rise in net profit to Rs 1,360 crore from Rs 1,025 crore in the year-ago quarter.

Gross non-performing assets (NPAs), as a percentage of total advances on a consolidated basis, rose to 2.02 per cent for the June quarter, as against 1.93 per cent in the year-ago quarter, and was 8 basis points higher than in the March 2019 quarter.

Dipak Gupta, joint managing director of Kotak Mahindra Bank, said credit cost would remain at around the same level for the bank. "We expect around 20 per cent loan growth for the full year," Gupta said. "The growth would mainly come from consumer related products," Gupta added. The management guided that corporate loan growth would remain sluggish, while the bank would be cautious about loan against property. 

"Yields have fallen marginally, but lower cost of funds helped protect the margin," said Jaimin Bhatt, president and group CFO, Kotak Mahindra Bank.  

Standalone net interest margin for the June quarter stood at 4.49 per cent, against 4.28 per cent in the year-ago quarter. The bank said NIM would remain at around the first quarter level for the rest of the year.

The bank's consolidated net NPA stood at 0.71 per cent for the June quarter, against 0.77 per cent in the year-ago quarter and 0.70 per cent in the March quarter. 

Capital adequacy ratio of the bank, according to Basel III norms, stood at 17.8 per cent for the quarter, while the Tier I ratio was at 17.3 per cent. 

Advances, on a standalone basis, as of June 2019, were up 18 per cent to Rs 2.08 trillion, as against Rs 1.77 trillion in the June 2018 quarter. The management said the bank planned to grow its loan book by around 20 per cent.

Deposits grew 22.8 per cent from Rs 1.9 trillion in Q1FY19 to Rs 2.33 trillion in the June 2019 quarter at the standalone level, with low-cost current and savings accounts (CASA) deposits at 50.7 per cent from 50.3 per cent a year ago.
Disclosure: Entities controlled by the Kotak family have a significant shareholding in Business Standard Pvt Ltd

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