Central Bank of India swung back into the black with a net profit of Rs 169 crore in the January-March quarter on the back of lower bad loans and stable loan growth.
The public sector lender had posted a loss of Rs 105 crore in the same quarter last fiscal. Net profit for the immediately preceding December quarter stood at Rs 180 crore.
Net interest income (difference between interest earned and expended) increased 25 per cent to Rs 153 crore.
During the quarter, contributing to the profits were lower provisions of Rs 445 crore that declined by about half from Rs 859 crore in the year-ago quarter.
Net profit in FY13 almost doubled to Rs 1,015 crore compared with Rs 533 crore in FY12.
As on March 31, 2013, the bank’s total advances rose by 16 per cent driven by robust growth in retail and agriculture loans, while corporate loan growth remaining flat during the year.
Total deposits grew 15 per cent. “We expect the deposits and advances growth to be bottom-driven at around 18 per cent in FY14,” said M.V. Tanksale, Chairman and Managing Director.
Net interest margins (NIM) annually declined to 2.67 per cent from 2.75 per cent in FY12 due to higher cost of deposits.
“NIM will be better going forwards as costs of deposits are likely to come down. NIM is expected to be in the 2.75 to 3 per cent range,” Tanksale said.
Gross non-performing loans (NPA) ratio declined marginally to Rs 4.80 per cent, while net NPA ratio declined to 2.90 per cent.
The board recommended a dividend of Rs 2.50 per share in FY13.
Shares of Central Bank closed higher by 4.25 per cent at Rs 72.30 per share on BSE on Friday.