Private banks? growth in net interest income (NII) during October third quarter (Q3) of 2007-08 was higher than public sector banks (PSBs) when compared with the similar period of the previous year.
In a study on the growth in NIIs of 26 PSBs and 18 private sector banks, it was found that NIIs , in the case of PSBs, rose by 7.7% to Rs 15,967 crore from Rs 14,830 crore.
The highest increase in NII was in the case of Indian Bank. NII of the bank increased from Rs 414 crore to Rs 562 crore. Interest income of Indian Bank increased by 30.4% during Q3 of 2007. On the other hand, interest expenditure increased by 27% during the same period.
Bank of India?s NII increased from Rs 859 crore to Rs 1,079 crore, while Union Bank of India?s rose to Rs 788 crore from Rs 686 crore.
State Bank of India, the largest PSB, showed a growth of 23.8% in its NII during Q3 of 2007-08.
Among the 18 private sector banks, five banks, namely, Yes Bank, Kotak Mahindra Bank, IndusInd Bank, HDFC Bank and Axis Bank showed more than 50% increase in NII during the quarter under review.
Between Q3 of 2006-December 2007 and the comparable period of the previous year, NIIs of 18 private sector banks increased by 44.1% to Rs 5,972 crore from Rs 4,144 crore. All the private sector banks, barring two, registered increase in NIIs by over 30 % during Q3.
The lowest increase in NII was witnessed in the case of J&K Bank (3.2%). This can be explained from its performance. The interest income and interest expenditure of J&K Bank increased by 33.5% and 55.6% respectively during October-December 2007.
In Q3, the highest NII was observed in the case of HDFC Bank (Rs 569 crore) followed by ICICI Bank (Rs 475 crore) and Axis Bank (Rs 356 crore).
The interest income and expenditure of HDFC Bank increased by 60.5% and 55.2% respectively during October-December 2007.