Private sector lender Kotak Mahindra Bank on Friday reported a 30.79 per cent jump in its consolidated December quarter net profit at Rs 3,402.74 crore, helped by an all-round performance across subsidiaries.
On a standalone basis, the city-based lender posted a 15 per cent rise in post tax net profit at Rs 2,131.36 crore, with a rise in operating expenses restricting the growth.
The bank’s core net interest income rose 11.81 per cent to Rs 4,334 crore, on an 18 per cent jump in advances and a 0.26 per cent expansion in the net interest margin to 4.62 per cent.
Other income grew marginally to Rs 1,363.66 crore, suppressed by a Rs 484 crore loss on its bond investments.
Operating expenses grew by a faster 32 per cent to Rs 2,996.96 crore due to a surge in costs undertaken on product sales and also a hit on employee pensions, its Chief Financial Officer Jaimin Bhatt told reporters.
The bank chose to write-back Rs 279 crore in COVID-19 provisions done earlier, which helped the profit number for the quarter, and the book now stands at Rs 1,000 crore.
Bhatt said the decision on write-back was taken after the second consecutive quarter of gross slippages being less than the recovery and upgrades, and specified that Rs 750 crore slipped into non-performing assets as compared to Rs 1,086 crore in recoveries and upgrades during the quarter.
The gross non-performing assets ratio improved to 2.71 per cent from 3.27 per cent in the year-ago period.
The restructured advances stood at Rs 1,364 crore or 0.54 per cent of the book, while the standard loans due for more than 61 days stood at Rs 298 crore as on December 31, 2021.
Bhatt said the loan growth would come at 20 per cent if one includes the credit substitutes offered to wholesale banking clients as well. He said the consumer book or retail advances at 38 per cent contributed the most to the loan growth, while wholesale loan growth came in at 20 per cent.
It is cautiously optimistic on the unsecured advances like credit cards and personal loans, and sees its contribution to the overall pie increasing to over 7 per cent from the present 5 per cent, its Joint Managing Director Dipak Gupta said.
Gupta hinted that with inflationary pressures and troubles on the crude prices front, the bank will be cautious on lending to the affected segments in commercial loans.
The bank added 21 lakh customers in Q3 to take its overall count to over 3 crore customers, Bhatt said, pointing to this as being one of the major reasons for the growth in operating expenses.
Among the subsidiaries, its non-bank Kotak Mahindra Prime’s post tax net improved to Rs 254 crore from Rs 149 crore, Kotak Mahindra Investments had its net rise to Rs 111 crore form Rs 68 crore, and Kotak Securities displayed strong numbers at Rs 270 crore when compared to Rs 184 crore in net profit in the year-ago period.
Kotak Mahindra Capital’s net profit shot up nearly three-times to Rs 103 crore and Kotak Mahindra Life Insurance had its bottomline increasing to Rs 247 crore from the year ago’s Rs 167 crore. However, Kotak Mahindra General Insurance’s loss widened to Rs 17 crore from Rs 3 crore.
The bank scrip closed 0.46 per cent higher at Rs 1,898.20 apiece on the BSE, as against a correction of 0.13 per cent on the benchmark.
