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State-controlled Vijaya Bank reported 24.54 per cent decline in net profit at Rs 139.94 crores for the July-September quarter ended in 2018. The bank had posted a net profit of Rs 185.46 crores in the corresponding quarter last year.
Vijaya Bank said in a BSE filing that the total income of the bank for the quarter under discussion stood at Rs 3,931.36 crores, rising 12.28 per cent from Rs 3,501.31 crores in the year-ago period. The bank’s gross non-performing assets (NPA) ratio improved to 5.86 per cent against 7.06 per cent during the corresponding period last year.
As per the company’s statement, Net Interest Income (NII) for the quarter increased by 15.58 per cent at Rs. 1,166 crores. Net Interest Margin (NIM) during the September-end quarter stood at 2.85 per cent compared to 3.04 per cent in the corresponding quarter of the previous year.
Vijaya Bank MD and CEO R S Sankara Narayanan said, “The fall in net profit is due to provisioning. Having 65 to 70 per cent provisioning is healthy for any private or public sector. The bank is interested in quality or strength of its balance sheet, not in showing higher profits and paying tax, which is not a viable proposal for any bank.”
Narayanan also added, “The bank’s second quarter was impacted by huge provisioning. Otherwise, we have maintained our profits. Operating profits are higher at 3.38 per cent at Rs. 758.82 crores in Q2, compared with Rs.733.96 crores posted last year. The bank’s retail credit growth was up by 26.67 per cent. Housing portfolio was commendable at 31.13 per cent growth.”
While talking about the amalgamation of Vijaya Bank with Dena and Bank of Baroda, he said “it is going to benefit us (Vijaya Bank) as we will get scale. From the current 2,300 outlets, we will be a 9,000 combined outlet”.
