Kotak Mahindra Bank reported a 27 per cent year-on-year (y-o-y) growth in standalone net profit at ₹2,581 crore on the back of robust growth in net interest income (NII), decline in provisions and healthy growth in customer assets.
Net profit in the year ago period was at ₹2,032 crore.
NII (difference between interest earned an interest expended) rose 27 per cent y-o-y at ₹5,099 crore (₹4,021 crore).
Total non-interest income, comprising fee-based income, trading income and other income, was up 8 per cent y-o-y to ₹1,955 crore (₹1,812 crore).
Operating profit increased 14 per cent y-o-y to ₹3,568 crore (₹3,120 crore).
Provisions (other than tax) were sharply lower by 68 per cent at ₹137 crore (₹424 crore).
Net Interest Margin improved to 5.17 per cent from 4.45 per cent in the year ago period.
Total customer assets, including advances and credit substitutes, rose 25 per cent y-o-y to ₹2,94,023 crore on the back of growth in home loans and loans against property (40 per cent growth), consumer bank working capital (22 per cent), personal loans, business loans and consumer durables (82 per cent), credit cards (81 per cent), commercial vehicle/ commercial equipment (26 per cent), agriculture division (19 per cent), among others. However, loans in the corporate banking segment barely grew.
Credit substitutes portfolio up
Replying to a question on why loan growth in the corporate banking segment was muted, Dipak Gupta, Joint Managing Director, observed that demand for resources from larger corporates these days is more in the form of credit substitutes (bonds). Credit substitutes portfolio grew by 28 per cent.
Total deposits rose by 11 per cent y-o-y to ₹3,25,203 crore. However, low-cost current account, savings account deposits declined to 56.2 per cent of total deposits against 60.6 per cent as at September-end 2021.
Gross NPA position improved to 2.08 per cent of gross advances as at September-end 2022 against 2.24 per cent as at June-end 2022. Net NPAs position too improved to 0.55 per cent of net advances against 0.62 per cent.
Meanwhile, the bank’s consolidated net profit was up 21 per cent at ₹3,608 crore (₹2,989 crore).
Consolidated numbers include the results of subsidiaries such as Kotak Mahindra Prime, Kotak Securities, Kotak Mahindra Life Insurance, Kotak Mahindra General Insurance, Kotak AMC and TC, among others.