Net interest income rose to Rs 118 crore, 29.67% higher than the same period last fiscal. Net interest margin also increased 4 bps y-o-y to 3.72%.
Murali M Natarajan, MD & CEO, DCB Bank: Cost increases are mainly on account of increase in branch network and number of employees. While the underlying cost/income ratio is improving, investments in expansion are putting pressure on the overall cost/income ratio. The total income of the bank in the second quarter rose 31.35% y-o-y to Rs 155 crore.
Net advances rose by Rs 8,793 crore, up 31.69 % y-o-y, mainly driven by corporate (33.1%) and agriculture and inclusive banking (78%) segments. Gross non-performing assets (NPAs) increased 21 bps y-o-y to 1.90% of the loan book where as net NPAs rose to 1.07%
The slight increase in gross NPA was primarily on the account of slippage of one account each in corporate banking and agriculture and inclusive banking. NPAs are in control. However, we have to be watchful. So far, business growth has been steady, said Natarajan.
DCB Bank had a healthy growth of 28.8% y-o-y in fees while the fee-to-earning assets was 1%. Productivity improved, with y-o-y core cost-income falling 374 bps to 62.9% and cost-to-assets flat y-o-y at 3.1%.