There has been a reasonable amount of growth between the second and third quarters. In fact, Q3 to Q2 growth in PAT has been almost 30 per cent, while the increase in net interest against the same period has been under 10 per cent. For the 9-month period ended December 1999, net interest income was higher by 12 per cent y-o-y, which was exceeded by the growth in fee-based and treasury income, which has increased by a little over 30 per cent.

The trend among leading stocks in the banking sector, especially the private sector banks, so far, has been a growth in fee-based income, which has outstripped income from traditional sources.

Corporation Bank has also reported a steep increasein operating expenses, which is higher by 20 per cent. After considering the 30 per cent increase in provisions, especially on account of non-performing assets, net profit growth has been restricted to 15 per cent. However, the nine-month profit almost eclipses the profit earned for the whole of 1998-99 of Rs 192 crore.

The bank has continued to diversify its sources of income, the latest venture being joining the ranks of primary dealers in government securities. Earlier, it had ventured into housing finance and gold dealing as well. But more importantly, the efforts at improving its efficiency is paying off.

In the last quarter of 1998-99 and the first half of the current year, there was a dip in operating efficiency seen by the fall in the return on average assets (RoA), which has since recovered to 1.4 per cent for the nine month period largely due to an improvement in the third quarter. Incidentally, despite the fall in RoA, this figure is still the best among all the public sector banks. Anothermajor improvement has been the fall in net NPAs, which has fallen from 1.98 per cent in March 1999 to 1.87 per cent for the period ended in December 1999.

The last quarter will look much better on a y-o-y basis, simply because a large chunk of the incremental wage cost was incurred in the last quarter last year.

The Corporation Bank stock has been vacillating between Rs 115-120 for quite some time now, indicating very little in terms of a direction. The total return from the stock in the last one quarter has been practically nil.