PSBs pip pvt peers on net profit, income

Written by Pradip Kumar Dey | Mumbai | Updated: Jul 31 2009, 03:54am hrs
Public sector banks (PSBs) have registered an increase of 102.6% and 27.1% in terms of net profit and total income, as against an increase of 42.4% and 13.5% respectively for private banks in April-June 2009. But a comparison between 18 PSBs operating in the country and 11 major private banks shows PSBs performed significantly better in terms of profitability during April-June 2009 compared to April-June 2008.

In the case of private sector banks, net profit to total income ratio at the aggregate level showed a marginal increase during April-June 2009, against that of April-June 2008, and in the case of PSBs, net profit to total income ratio also showed an increase.But the ratio was higher in private banks compared to PSBs during April-June 2009 and April-June 2008.

The aggregate total income of 11 private sector banks has increased from Rs 21,014 crore in April-June 2008 to Rs 23,860 crore in April-June 2009.Their total net profit has increased to Rs 2,671 crore in April-June 2009 from the level of Rs 1,875 crore in April June 2008, increasing the net profit to total income ratio marginally from 8.93% to 11.19% .Highest increase in net profit in April-June 2009 was registered in the case of IndusInd Bank followed by Karur Vysya Bank and Karnataka Bank.

State-run banks, on the other hand, appeared more concerned about profitability. Its total income increased from Rs 35,480 crore to Rs 45,105 crore during April-June 2009, and the net profit has increased to Rs 4,799 crore during April-June 2009 from Rs 2,368 crore during April-June 2008. And the profitability ratio increased from 6.68% to 10.64% during the study period.

Among PSBs,highest increase in net profit in Q1 was observed in the case of SB Of Mysore followed by Canara Bank and Central Bank Of India. Significant increase in the ratio was seen in the case of Canara Bank.The net profit to total income ratio of Canara Bank increased from 2.99% in April-June 2008 to 11.04% in April-June 2009. In Central Bank Of India, the ratio increased significantly from 2.31% to 8.35% in April-June 2009. But in Bank Of India, the ratio marginally decreased from 13.66% to 11.63% during the above period. Top three PSBs in terms of profitability ratio in Q1 are Indian Bank, SB Of Travancore and Andhra Bank.

Among private sector banks, IndusInd Bank showed significant increase in the ratio.The net profit to total income ratio of the bank increased from 3.27% in April-June 2008 to 10.79% in April-June 2009. Similarly, in the case of Yes Bank, the ratio increased from 11.17% to 14.55% during April-June 2009. In ICICI Bank also, the ratio increased from 7.72% to 9.52% during the study period. Fee-based revenue enabled ICICI Bank to increase the profitability ratio in Q1.Top three private banks in terms of profitability ratio in April-June 2009 are Axis Bank, Yes Bank and Karur Vysya Bank.One interesting thing is that all private sector banks except one showed an increase in the profitability ratio in April-June 2009, while 83 % of PSBs showed an increase in the net profit to total income ratio during the same period.