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Bank of Maharashtra’s (BoM’s) net profit rose by 138.76 per cent year-on-year (YoY) to Rs 775.03 crore during the quarter ended December (Q3 of FY23). This was on the back of an improvement in net interest margin (NIM).
The Pune-based public sector lender had posted a net profit of Rs 324.63 crore in Q3 of FY22.
Net profit was higher in Q3 compared to Q2 when the figure stood at Rs 535.06 crore.
The bank’s stock closed 4.6 per cent higher at Rs 33.05 per share on the BSE on Monday.
BoM is planning a qualified institutional placement (QIP) of equity shares during the last quarter of FY23. This will help reduce the Centre’s stake by about 5 per cent from the present level of 91 per cent. This was stated by A S Rajeev, the bank’s managing director (MD) and chief executive officer (CEO) at a media interaction after the Q3 results.
Total capital adequacy ratio (CAR) stood at 17.53 per cent in December 2022.
BoM’s net interest income (NII) was up 29.65 per cent YoY in Q3 to Rs 1,980 crore. Sequentially, NII rose from Rs 1,887 crore in Q2.
Its NIM improved to 3.60 per cent in Q3 from 3.11 per cent in Q3FY22. Sequentially, NIM rose from 3.55 per cent in Q2.
The margins are expected to remain between 3.5 and 3.75 per cent in the current quarter (Q3), said Rajeev.
The lender’s non-interest income rose 5 per cent YoY to Rs 641 crore during the quarter under review. Sequentially, it rose from Rs 502 crore during the quarter ended September 2022.
Asset quality profile improved with gross non-performing assets (GNPAs) at 2.94 per cent in Q3 of FY23, compared with 4.73 per cent a year ago. Sequentially, GNPAs were down from 3.34 per cent in September 2022.
Net NPAs dipped to 0.47 per cent from 1.24 per cent. Sequentially, they improved from 0.68 per cent in July-September 2022.
The NPAs are already low and there is very little chance to reduce them further. The bank will work to keep gross NPAs below 3 per cent and net NPAs below 0.5 per cent, Rajeev said.
The provision coverage ratio (PCR) rose to 97.18 per cent for the quarter under review from 93.77 per cent a year ago.
Sequentially, it improved from 96.06 per cent in July-September 2022.
On the business expansion front, the bank’s loan book grew by 21.67 per cent YoY to Rs 1.57 trillion for the third quarter ended December 2022. Sequentially, the rate of growth has moderated from 28.65 per cent clocked in Q2.
The bank expects to expand its loan book by about 22-23 per cent in FY23 with sound asset quality and prudent borrower selection.
The deposits grew by 11.69 per cent YoY to Rs 2.08 trillion in October-December 2022. The board has mandated a growth of 12-15 per cent YoY for deposits.
The share of low-cost money, current account and savings account (CASA) deposits, declined to 52.5 per cent at end of December 2022. This was from 56.27 per cent in July-September 2022 and 55.05 per cent a year ago.
Credit-to-deposit (C/D) ratio was 75.30 per cent at the end of December 2022, up from 69.13 per cent a year ago. Sequentially, the ratio rose from 75.68 per cent in September 2022.
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