State-run Bank of Maharashtra on Thursday said its net profit for the March quarter more than doubled to Rs 355 crore from Rs 165 crore a year ago on improved loan sales and asset quality leading to lower provisioning and better cost-to-income ratio.
For the full year to March, the Pune-based lender saw its net profit rising two-fold to Rs 1,152 crore as against Rs 550 crore in FY21.
Chief executive and managing director A S Rajeev attributed the robust numbers to the overall improved sentiment and the rising credit demand.
As a result, advances rose 25.62 per cent to Rs 1,35,240 crore for the year and the better business environment led to improved repayments bringing down gross NPAs to 3.94 per cent and net NPAs to 0.97 per cent.
The bank saw a massive improvement in overall asset quality with fresh slippages at Rs 728 crore matching the recoveries at the same amount in the year.
Its gross NPAs nearly halved to 3.94 per cent from 7.23 per cent in March 2021 quarter, and from 4.73 per cent in December 2021, while net NPAs more than halved to 0.97 per cent from 2.48 per cent in March 2021 and from 1.24 per cent in December 2021.
This led to the bank making lower provisions which plunged 73 per cent to Rs 365 crore on year from Rs 1,341 crore and from Rs 836 crore in the December quarter, down 56 per cent.
While total business grew 19.84 per cent to Rs 3,37,534 crore, gross advances grew 25.62 per cent to Rs 1,35,240 crore in Q4 as against Rs 1,07,654 crore in Q4FY21 and net advances rose 28.09 per cent to Rs 1,31,170 crore and total deposits rose 16.26 per cent to Rs 2,02,294 crore of which the low-cost Casa stood at 57.85 per cent.
Rajeev said net interest income, which is the difference between what the bank earned from lending after paying interest for its funds, rose 16.56 per cent to Rs 1,612 crore during the quarter as net interest margin improved to 3.17 per cent, as the cost to income ratio was contained at 44.76 per cent.
Projecting for a stronger year of growth and profitability, Rajeev told PTI that he expects the loan demand, which has been strong in the reporting quarter to remain stronger through the year with 18-20 per cent overall growth while it may be a tad lower at 16-18 per cent in Q1 which is normally a low intake period. Similarly, he expects deposit flow to be steady at 15-16 per cent in the current fiscal.
However, lower other income pulled down overall income for the quarter to Rs 2,134 crore from Rs 2,620 crore. Its fee-based income rose to Rs 372 crore and non-interest income stood at Rs 522 crore.
Cost to income ratio improved to 44.76 per cent from 41.17 per cent in Q4FY21. The same was 45.63 per cent for the December quarter.
Loan growth was led by retail, agri and MSMEs which grew 18.66 per cent on-year. Retail advances grew 23.63 per cent to Rs 35,422 crore, while MSME grew 13.60 per cent to Rs 26,279 crore.
The BoM counter gained 2 per cent to close at Rs 18.15 on the BSE on a day the benchmark Sensex rallied 1.23 per cent.
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