Andhra Bank Posts 2-fold Increase in Q2 Net at Rs 144 cr

HYDERABAD: Aided by higher interest income and agriculture loan rollovers in Telangana and Andhra Pradesh (AP), Andhra Bank on Thursday registered 104.5 per cent rise in net profit at Rs 144.49 crore for the quarter ended September 2014 as against Rs 70.65 crore achieved during the corresponding period a year ago.

Total income rose by 15.84% at Rs  4,423.62 crore in the quarter under review compared to Rs 3174.73 crore posted the previous year.

Its gross NPAs stood at Rs 6,884 crore, while net NPAs were at Rs 4,316 crore as in September 2014.

According to CV Rajendran, CMD, its asset quality will improve in the second half of the current fiscal as recoveries on farm loans are expected to be better.

The bank’s exposure in the cyclone-hit Visakhapatnam is about Rs 5,000 crore and it is anticipating need for rescheduling some of the loans. As for crop loan waiver, both Telangana and AP governments have declared about 25 and 20 per cent respectively to be paid this fiscal.

“As the agriculture loan rollovers are taking place in both the states after the two governments took concrete steps on loan waiver, we have not booked any fresh NPAs on agriculture front,” he said and added that an interest reversal of Rs 393 crore made earlier will be reversed in Q3, which could translate to a better performance next quarter.

The bank will raise Rs 1,000 crore (Rs 500 crore plus Rs 500 crore Tier-I bonds) by December or January and is also expecting government budgetary allocation of Rs 200-300 crore.

For FY15, the bank has set a target of Rs 900 crore net profit and is hopeful of achieving the same by reducing non-performing assets.

Retail credit registered 18.6 per cent growth over last year, while priority sector advances grew by 14.39 per cent at Rs 42,131 crore over last year.

Agricultural advances rose by 15.19 per cent at Rs 20,815 crore and MSME advances shot up by 15 per cent to touch Rs 13,950 crore.