Telangana Grameena Bank (TGB) has posted a 23 per cent increase in net profit at ₹43 crore in the financial year ended March 31, 2019, compared to ₹35 crore in the previous year.

The Hyderabad-based regional rural bank, sponsored by State Bank of India, had seen a steep surge in gross profit at ₹239 crore, against ₹55.59 crore in 2017-18. This was before the tax and pension provision.

“Increase in loan book, shedding of high cost deposits, and strong recovery of Non-Performing Assets (NPAs), among others, drove increase in profit during FY19,” V Arvind, Chairman, TGB, told Business Line.

With the improvement in Current Accounts and Savings Accounts (CASA), cost of deposits was lower during the year under review at 5.94 per cent (6.95 per cent).

The cost of funds was at 5.40 per cent (5.88 per cent). Net Interest Margin (NIM) increased to 3.73 per cent (2.36 per cent), and total business of the bank increased by 13 per cent at ₹1,4762 crore.

Focus

Going forward, TGB will step up its focus on housing loan segment, according to Arvind. During 2018-19, incremental growth in housing loan segment was ₹100 crore.

“We are targeting an incremental growth of ₹250 crore this year. The aim is to have a total portfolio of ₹850 crore in home loan segment,” the Chairman said.

TGB, which has 421 branches now, is also looking at expansion. “We will surely expand. However, we need to take a call on whether to set up brick-and-mortar branches or through the business correspondent model,” he siad.

Apart from introducing mobile ATM vans to extend services in un-banked areas, TGB also introduced 400 micro ATMs at rural branches under Green Channel Banking initiatives.

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