Vijaya Bank on Thursday reported a 34% rise in its net profit for the September quarter at Rs 1,54.6 crore. The bank managed to report higher profit despite an increase in provisions, as it significantly improved net interest income.
Total income for the quarter came in at Rs 3,516.6 crore, up 9.8% year-on-year because of a rise in interest income. A doubling of other income to Rs 388.3 crore also helped it post higher revenue.
Net interest income increased 19.5% year-on-year to Rs 827.8 crore.The public sector lender reported a weakening of its asset quality on a year-on-year basis. However, on a sequential basis, the bank managed to improve its asset quality marginally.
Gross non-performing loans – as a percentage of total loans – fell by 24 basis points quarter-on-quarter to 7.07%, while net NPA declined 32 bps to 5.10%. However, since the year-ago period was before the RBI’s asset quality review, the year-on-year change in gross and net NPA were as high as 309 bps and 226 bps, respectively.
In absolute terms, the bank reported gross non-performing loans of Rs 6,490.52 crore and net non-performing loans of Rs 4,587.16 crore as on September 30. Consequentially, Vijaya Bank was forced to increase its provisions for bad loans too.
For the quarter under review, the bank made provisions of Rs 389.8 crore, 42.5% higher year-on-year and 45.6% higher on a sequential basis.