Andhra Bank’s net profit declined 15.7 per cent at Rs 257 crore in the third quarter ended December 31, 2012, compared to Rs 303 crore in the year-ago period.
The total income, however, grew to Rs 3,469 crore (Rs 3,158 crore) and total business crossed the Rs 2-lakh crore mark and stood at Rs 2,02,740 crore, a growth of 14 per cent.
“Net profit growth has not been very strong on account of additional provisions for non-performing assets, new wage settlement and income-tax, among others,” B. A. Prabhakar, Chairman and Managing Director, Andhra Bank, told newspersons here on Thursday.
Total provisions stood at Rs 285 crore, including Rs 149 crore for NPAs.
The year-on-year comparison might not be good in the current economic environment, but core operating profit was on a steady growth path, he added.
Sequentially, it grew from Rs 638 crore in the September quarter to Rs 711 crore in the quarter under review.
On the increase in non-performing assets, Prabhakar said they were mainly from large and mid corporates.
“Two large accounts — a major media house and a transformer-maker— slipped, which alone amounted from Rs 400 crore,” he said.
The loan recovery process was under way for the media client as it had ‘strong’ securities, he added.
Focus areas
Going forward, the bank would be “very cautious” in giving corporate loans and would focus on retail, agriculture, and micro, small and medium enterprises,” he said.
The credit growth in the corporate sector was still “very low” largely due to the macroeconomic environment, he added.
Andhra Bank’s scrip lost 6.92 per cent on the Bombay Stock Exchange on Thursday to end at Rs 110.25.