For the whole year 2007-08, the banks profit was up by 15.73% to Rs 729 crore as against Rs 630 crore in 2006-07. Unlike some other major banks IDBI Banks 41 clients have an exposure of Rs 173 crore in derivative portfolio and the bank has zero provisioning on the same.
We are not involved in any litigation for our derivative trading, said, Yogesh Agrawal, chairman and managing director, IDBI Bank. The bank is planning to raise Rs 1000 crore under Tier II during the current fiscal in its bid to maintain its capital adequacy ratio at the current level of 11.95%.
The total business of the bank stood at Rs 1,55,211 crore as against Rs 1,05,825 crore a year ago, thus registering a growth of 46.67%. While deposits increased by 68.38% year-on-year to Rs 72,998 crore, advances increased by 31.60%to Rs 81,213 crore.
However, the bank has moderated its credit growth for the current fiscal. Agrawal said, For the current fiscal, we have projected a target of 25%, against 31% last year, in the credit growth and 50% in the deposits growth.
The net NPA of the bank during the year was at 1.3%, which has gone up as some of the accounts of the bank have turned sticky.
The bank wants to keep its net NPA below 1% at the end of the current fiscal, said Agrawal. The cost of fund of the bank during Q4 2007-08 went up at 8.72% as against 7.27% a year ago.
Yields on advances also went up during the period at 10.31% against 9.32% a year ago. The bank was planning to increase its Net interest margin (NIM), which was at 0.67% during the last year, to 1% during the current fiscal, said Agrawal.
The bank is holding licence for opening 200 branches during current fiscal, including four overseas branches, and a representative office each in Shanghai and Singapore during the current fiscal.