Development Credit Bank posts 52% rise in profit on lower NPAs
Nifty could again test the 200 daily moving average or DMA of 5148. This has acted as a strong support for the past two months.
Development Credit Bank (DCB Bank) today reported 52 per cent rise in net profit at Rs 17.3 crore in the fourth quarter ended March 31 against Rs 11.4 crore in the year-ago period on the back of lower provisioning and overall reduction in costs.
"We have seen all-round improvement in our performance in Q4 as well as during the entire fiscal, driven by lower provisioning, reduction in overall cost and better quality of our loan books," DCB Bank Managing Director and CEO Murali M Natrajan said.
During the quarter under review, the bank's gross NPA ratio came down to 4.40 per cent at Rs 7 crore from 5.85 per cent or Rs 11 crore. Its net NPA ratio improved to 0.57 from 0.96 per cent.
For the full year, the bank, which primarily focuses on MSMEs, SMEs and retail mortgages, saw its net profit more than doubling to Rs 55.1 crore from Rs 21.4 crore, driven by lower provisioning which massively came down to Rs 29 crore from Rs 65 crore.
On the bad loan front, Natarajan said, for the bank, which had quit unsecured loan portfolio in 2009, the stress came from some corporate loans during the quarter, but did not specify the sectors.
Going forward, Natarajan said he sees more pressure on the margins at least in the next two quarters and muted pick up in advances at around 3-4 per cent.
However, he sounded bullish for the full fiscal (FY13), saying the loan book will grow by 22-24 per cent.
The lender saw its cost of funds going up to 7.57 per cent from 7.16 per cent in Q4, bringing down its NIM to 3.12 per cent from 3.15 per cent. For the full fiscal, NIM was 3.25 per cent as against 3.13 per cent last fiscal.