MUMBAI: Chennai-based public sector lender Indian Overseas Bank has reported a close to 21% jump in net income at ₹874 crore for the December quarter, boosted by improved asset quality and higher recoveries. In the year ago period, the public sector lender had earned ₹723 crore in net income.
In an earnings call Monday, Ajay Kumar Srivastava, the managing director and chief executive of the bank, told reporters that the bank’s total income climbed more than 13% to ₹8,409 crore from ₹7,437 crore, of which the key interest income increased by 15.16% to ₹7,112 crore and the net interest income grew higher by 16.30% to ₹2,789 crore.
Sequentially, net profit improved 12.35%, as the bank recorded a net profit of ₹777 crore in Q2. The bank's net interest income, which is the difference between the interest income earned from lending activities and the interest paid to depositors, jumped to ₹2,789 crore in Q3, a 16.35% improvement compared to ₹2,397 crore in the same quarter last year.
On the asset quality front, the gross NPAs declined to 2.55% from 3.90% and the net NPAs fell to 0.42% from 0.62%. This has the bank’s provision coverage ratio improving to 97.07% from 96.85%, Srivastava, who has been helming the bank since January 2023, said.
The bank saw higher recoveries too at ₹956.65 crore, of which ₹676.64 crore came in from written off accounts.
Total business grew 10% to ₹5,42,753 crore from ₹4,94,209 crore, of which deposits grew close to 10% to ₹3,05,121 crore and advances also rose at the same pace to ₹2,37,632 crore.
The profitability metric net interest margin stood at 3.33%, the bank said without offering the comparative set of numbers.