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DCB Bank Q1 net profit rises 17% to Rs 81.10 crore, asset quality declines

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DCB Bank Q1 net profit rises 17% to Rs 81.10 crore, asset quality declines

DCB Bank's net interest income (NII) rose 12 per cent to Rs 304.70 crore in April-June quarter of FY20, compared to Rs 273 crore in Q1FY19

Private sector lender DCB Bank has reported a 17 per cent year-on-year (YoY) growth in net profit at Rs 81.10 crore during the quarter ended June 30, 2019.

"The private lender posted a net profit of Rs 69.50 crore in the same quarter last year," DCB Bank said in a filing to the Bombay Stock Exchange.

The bank's net interest income (NII), which is the difference between interest earned and interest expended, rose 12 per cent to Rs 304.70 crore in April-June quarter of FY20, compared to Rs 273 crore in Q1FY19. The other income (non-interest income) was up 5 per cent at Rs 87 crore against Rs 83 crore in the same period last year.

The operating profit of the bank increased to Rs 167 crore during the June quarter of 2019-20, as compared to Rs 141 crore in the same period of 2018-19.

The provisions and contingencies of the bank increased to Rs 40.64 crore from Rs 33.23 crore in the year-ago period.

Also Read: Federal Bank Q1 profit jumps 46% to Rs 384 crore on higher interest income

Commenting on Q1 earnings, Murali M Natarajan, managing director and chief executive officer, DCB Bank said, "We are focussing on granular retail term deposits to further improve our deposit profile. Some margin pressure will be felt for two more quarters, beyond which, we expect stability due to the re-pricing profile of long-term refinance and renewal cycle of customer deposits."

DCB Bank's asset quality declined during June quarter, with gross non-performing assets (NPAs) ratio - bad loans as a percentage of gross advances - rose to 1.96 per cent versus 1.86 per cent in the year-ago quarter. Net NPA expanded to 0.81 per cent during June quarter as compared to 0.72 per cent in the corresponding quarter last year.

The bank's absolute gross NPA stood at Rs 476.40 crore in Q1FY20 against Rs 400.60 crore in Q1FY19.

As on June 30, net advances (including corporate banking) grew to Rs 24,044 crore from Rs 21,243 crore in the year-ago period, registering a growth of 13 per cent. The bank's deposit rose by 15 per cent y-o-y to Rs 28,789 crore.

Also Read: IndusInd Bank Q1 results: Net profit surges 38% to Rs 1,433 crore, revenue climbs to Rs 8,625 crore

In a separate development, the bank said it has allotted 54,025 equity shares of Rs 10 each under the employee stock option plan (ESOP) of the bank. Post this allotment, the bank's issued and paid-up share capital has increased to 30.98 crore equity shares of Rs 10 each.

Ahead of Q1 result, DCB Bank shares closed trade at Rs 238.80 apiece, up 1.27 per cent, on the Bombay Stock Exchange on Tuesday.

Edited by Chitranjan Kumar