Bank of Maharashtra Q2 net profit jumps 103% on higher interest income
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In the retail loan segment, housing loans grew by 20.35%, while vehicle loans were up 27% compared to a year ago. The earlier stressed MSME too was showing clear signs of cash flow and better capacity utilisation, the CEO said. MSME advances grew 20.66% YoY to Rs 22,995 crore for Q2FY22.
Bank of Maharashtra (BoM) on Thursday reported a 102.71% Y-o-Y rise in its net profit to Rs 264 crore for the September quarter. The net interest margin improved to 3.27% on a Y-o-Y basis against 2.3% in the comparable quarter last year. Net interest income increased by 33.84% to Rs 1,500 crore, compared with Rs 1,120 crore during Q2FY21.
The bank’s net NPA was at 1.73%, while gross NPA came in at 5.56%, as against a net NPA ratio of 3.30% and gross NPA ratio of 8.81% last year. The bank’s provisional coverage ratio improved to 92.38%. It held cumulative Covid-19 provision of Rs 973 crore as on September 30, 2021.
AS Rajeev, CEO, said this was the highest net interest margin reported by the bank in the last five years. Apart from the rise in the net interest margin and net interest income, profits got a boost with Rs 258-crore recovery from the DHFL account and Rs 80 crore from another small account, taking the total recovery to Rs 340 crore. BoM had an exposure of Rs 553 crore to Srei Group which was written off and fully provided for, he said.
Rajeev expects the bank to see a credit growth of around 14-16% for the full year as the economy is opening up. The bank’s strategy of reducing the share of corporate loans and expanding the retail, agriculture and MSME (RAM) segment has paid dividends, with RAM advances growing by 14.4% YoY to Rs 30,4800 crore, he said.
In the retail loan segment, housing loans grew by 20.35%, while vehicle loans were up 27% compared to a year ago. The earlier stressed MSME too was showing clear signs of cash flow and better capacity utilisation, the CEO said. MSME advances grew 20.66% YoY to Rs 22,995 crore for Q2FY22.
The bank plans to raise funds to meet its growth requirements. It raised equity capital of Rs 403.70 crore in the second quarter. It has plans to raise Rs 1,000 crore through tier II bonds.
Total business grew by 13.27% to Rs 296,808 crore. Deposits rose 14.47% to Rs 181,572 crore while gross advances increased 11.44% to Rs 115,235 crore.
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