New Delhi based state-owned lender Oriental Bank of
Commerce reported a whopping 80%
year-on-year jump in its net profit at Rs 302 crore for the second quarter
ended September 30, 2012-13; bolstered by a combination of factors: higher
interest and other incomes as well as lower provisions against bad loans.
Net interest income or the difference between interest
earned and paid out, increased 17% y-o-y to Rs 1,157. However, the bank's loan
book expanded nearly 13% y-o-y to around Rs 1.18 lakh crore. The Reserve Bank
of India had earlier projected an industry credit growth of around 16% in
2012-13. Most of the banks are expecting credit uptick in the busy season
(October-March).
The quarterly numbers were slightly below expectations.
Analysts on an average had expected net profit at Rs 334 crore and net interest
income of Rs 1,182 crore for the quarter. However, investors cheered the
numbers on a three-pronged reason: improved asset quality, mitigated concerns
over the bank's restructured loan book and cheap valuation of current stock
price. At 14:55 hrs, Oriental Bank shares were trading at 310, up nearly 6%.
In the second quarter, other income increased 47% to Rs 407
crore. Provisions and contingencies fell to Rs 460 crore from Rs 485 crore in
the corresponding quarter of the previous year.
Gross non-performing asset ratio improved to 2.92 % compared
with 2.95% in Q2, FY12 and 2.97% in April-June quarter, FY13. Net NPA ratio
however went up from 1.90% to 2.04% y-o-y basis but almost remained unchanged
at 2.05% quarter-on-quarter basis.
Net NPAs are determined after deducting provisions from
gross NPAs. Hence, a lower provision leads to higher net NPAs.
Deposits grew 10% y-o-y to Rs 1.64 lakh crore. Capital
adequacy ratio stood at 12.06% versus 12.29% QoQ.
Source: www.moneycontrol.com
Thanks,
Gaurav Agarwal
Head Dealer
DENIP Consultants Pvt Ltd
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