DCB Bank Q3 profit jumps 51% to Rs 86 cr, provisions remain elevated

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Private sector lender DCB Bankhas reported a massive 51 percent on year growth in third quarter profit at Rs 86.1 crore despite higher provisions. The growth was largely driven by NII, other income and operating income.

Profit in same quarter last year stood at Rs 57 crore.

Net interest income, the difference between interest earned and interest expended, grew by 17.2 percent year-on-year to Rs 293.6 crore with credit growth of 23 percent YoY.

“Net advances grew to Rs 22,888 crore as on December 2018 from Rs 18,595 crore as on December 2017 a growth rate of 23 percent,” the bank said, adding deposits grew by 29 percent to Rs 27,509 crore YoY.

Net interest margin was unchanged at 3.83 percent in Q3 QoQ, but contracted from 4.12 percent in same period last year.

Asset quality slightly weakened during the quarter. Gross non-performing assets (NPA) as a percentage of gross advances were higher at 1.92 percent in Q3 against 1.84 percent in Q2 and net NPAs were higher at 0.71 percent against 0.70 percent QoQ.

In absolute terms, gross NPAs increased by 9 percent sequentially to Rs 445.1 crore and net NPA by 5 percent to Rs 163.4 crore, driven by higher slippages.

Fresh slippages at the end of December quarter stood at Rs 114 crore, which were higher compared to Rs 97 crore reported in previous quarter, the bank said, adding recoveries were at Rs 27.9 crore and upgrades at Rs 35.1 crore in Q3 (against Rs 32.7 crore and Rs 37.3 crore respectively).

Provisions and contingencies increased by 26 percent sequentially and 17 percent YoY to Rs 40.1 crore in quarter ended December 2018.At 15:04 hours IST, the stock was quoting at Rs 182.20, down Rs 0.95, or 0.52 percent on the BSE.