Private lender Kotak Mahindra Bank Ltd.’s profit rose in the quarter ended March, aided by an increase in income.
Net profit for the quarter jumped 33% over a year earlier to Rs 1,682 crore, according to its exchange filings. Analysts polled by Bloomberg estimated a net profit of Rs 1,908 crore.
Net interest income, or core income, rose 8% year-on-year to Rs 3,843 crore against the forecast of Rs 3,739 crore. Other income rose 31% to Rs 1,949 crore.
In the fourth quarter, the bank set aside Rs 110 crore from interest earned to refund borrowers benefitting from a Supreme Court decision in March. The apex court had asked all lenders to return the compound interest for the moratorium period to all of borrowers, not just those with dues up to Rs 2 crore.
Gross non-performing asset ratio of the bank fell to 3.25% as of March from 3.27% in the preceding quarter. The net NPA ratio improved marginally to 1.21% from 1.24% in December. The December quarter asset quality figures include the accounts which were not classified as NPAs because a Supreme Court order barring lenders from downgrading accounts at the time.
Loans worth Rs 121. 5 crore were restructured under the Reserve Bank of India’s one-time window. This included Rs 82.38 crore worth of retail loans, Rs 12.67-crore corporate loans and Rs 26.45-crore other accounts. Kotak Mahindra Bank held provisions worth Rs 12.92 crore against these accounts.
As of March, the bank held Rs 1,279 crore worth of floating provisions against accounts impacted by Covid-19. The bank said it did not dip into its Covid provisions during the fourth quarter. Total provisions, which include standard asset provisions, specific loan loss provisions and Covid-19 provisions, stood at Rs 7,021 crore.
Credit cost for Kotak Mahindra Bank rose to 84 basis points in the financial year 2020-21 compared with 67 basis points a year ago.
The bank’s total advances improved to Rs 2.39 lakh crore from Rs 2.29 lakh crore a year earlier. That was largely aided by a 13% year-on-year increase in home loans at Rs 54,749 crore as of March. The bank brought down the shared of unsecured retail advances to 5.8% of the loan book as of March from 7.5% a year ago.
Total deposits rose 6.5% year-on-year to Rs 2.8 lakh crore. Low-cost current and savings account deposits contributed 60.4% as of March, up from 56.2% a year ago.