Oriental Bank of Commerce net profit slumped 20.65% to R265 crore in January-March quarter (Q4) in financial year 2011-12 (FY12) from R334 crore in Q4 FY11.
A sharp spike in non-performing assets (NPAs), reversal of interest income, higher deposit costs and increase in restructured assets contributed to lower prof its. OBC stock closed lower 4.7% at R230.25 at the Bombay Stock Exchange on Monday.
Its gross NPA ratio grew to 3.17% of gross advances as on March 31, 2012, higher than 2.92% as on December 31, 2011 and 1.98% as on March 31, 2011.
The net NPA ratio was at 2.21% of net advances as on March 31, 2012, higher than 1.89% as on December 31, 2011 and 0.98% as on March 31, 2011.
The bank’s CMD SL Bansal said the lender was taking stepts to reduce NPAs, including a special settlement scheme for NPA accounts below R10 lakh.
The bank has recorded a 29.23% increase in total income at R4,564.50 crore in Q4 FY12, compared with R3,532.13 crore in Q4 FY11. The bank has proposed a dividend of R7.90 per share for 2011-2012.
The state-owned lender OBC recorded a 24% decline in net profit at R1,141.56 crore in the entire fiscal in 2011-12 from R1,502.87 crore in 2010-11. Total income during the period increased 30.71% to R17,055.13 crore in 2011-12 from R13,047.89 crore in 2010-11.
Its deposits grew 12.16% to R1.56 lakh crore year-on-year in 2011-12, while advances grew 16.74% to R1.13 lakh crore in 2011-12. OBC’s gross NPA ratio jumped to 3.17% in 2011-12 from 2.92% in 2010-11
Its capital adequacy ratio as per Basel-II norms stood at 12.69% as on March 31, 2012, higher than 12.12% as on December 31, 2011 and 14.23% as on March 31, 2011.