Mid-sized public sector lender Central Bank of India has reported a 13.3% growth in net income at Rs1,324 crore in the June quarter, driven by better asset quality and robust loans growth.
Total income of the city-based bank rose to Rs 10,678 crore during the quarter from Rs10,360 crore, driven by higher interest income, which rose to Rs9,691 crore from Rs8,589 crore, a growth of 15.70% in the June quarter of FY26. Its operating profit declined to Rs2,186 crore from Rs2,304 crore in the year-ago period due to rise in operating cost.
The better bottom line comes despite the bank seeing its key profitability metric net interest margin inching down to 3.06% but this was offset by an improvement in cost-to-income ratio and cost of funds, as well as credit cost, which respectively declined to 55.40% from 55.30%, to 4.60% from 4.90% and 0.40% from 0.68% during the quarter.
On the asset quality front, the lender saw its gross NPAs declining by 53 bps to 2.60%, as a result, provisions for bad loans declined significantly to `346 crore from `468 crore and net NPAs remained flat at 0.49%, chief executive Kalyan Kumar told reporters here on Friday.
Total business grew 18.29% to Rs8,33,320 crore from Rs7,04,485 crore, of which total deposits stood at Rs4,78,972 crore, up 11.68% and the low-cost Casa deposits consisted of 46.61% of the total deposits. Gross advance jumped 28.58% to Rs3,54,348 crore, primarily driven by corporate book, which rose nearly 48%.
On the advances front, Kumar said the key RAM book that consists of retail, agriculture & MSME grew 21.38%. The individual sector-wise growth stood at 23.92% (Rs1,05,523 cr), 21.14% (Rs64274 cr) and 18.03% at Rs71,308 crore, respectively.
Another key driver of loans was gold loans, which jumped to `36,000 crore, up 89%. Of this, as much as Rs34,000 crore are disbursed through branches and the rest through third-parties. The bank sees more upsides to its gold loan book.
On the recovery through auction from the bankrupt airline Go Air, which owes the bank a little over Rs1,900 crore, the bank said it will launch the fourth auction of the Thane plot (having failed the first three) next month with a lower reserve price of Rs1,375 crore.
On the FCNR-B deposit mobilisation, the bank said it could mop up only $8.4 million so far from its domestic branches (as the bank does not have presence overseas) but sounded confident of garnering at least $500 million by the end of the special window. During the rest of the days, Kumar said, the bank is planning to open a special NRI deposit drives during the festive weeks, to meet the target.