Bank of Maharashtra posts higher profit, growth

THE Bank of Maharashtra have reported 28.34 per cent growth in operating profits in the quarter ended March 2017as compared to the same peri

Speaking on the occasion, R P Marathe, MD & CEO of the Bank stated, “The bank is in the process of consolidating their financial position recording an all-round improvement in asset quality, capital adequacy, and profitability. Focussed approach on increasing income and reduce expenditure has resulted in 547 basis points improvement in cost to income ratio on year on year basis in the March 2018 quarter.”

Elaborating on future plans of the Bank, Marathe said, “We are taking steps in the direction of realigning our business for more profitable and efficient use of capital. A well-diversified loan portfolio with priority to retail, agriculture and MSME sectors is our focus area.Reform initiatives are being implemented to bring subtle improvements in our customer service and offerings to all stakeholders.

Key Performance Highlights

Profitability:

* Operating Profit for the year ended March 31, 2018 increased by 19.94 per cent Y-o-Y to Rs 2191.42 crore as against Rs 1827.07 crore on March 2017.

* Operating Profit for the quarter ended March 31, 2018 stood at Rs 546.75 crore as compared to Rs 426.09 crore for the March 31, 2017 quarter, registering growth of 28.32 per cent.

* Operating Expenses for the year ended March 31, 2018 reduced by 5.30 per cent on Y-o-Y.

* The Bank has further improved in CASA ratio to an all-time high of 47.74 per cent that helped in reducing interest expenses.

* Interest expenses for the year ended March 31, 2018 declined by 13.28 per cent to Rs7706.68 crore as compared to Rs 8887.27 crore in the previous year. Interest expenses for the March 31, 2018 quarter declined by 17.93 per cent to Rs 1811.20 crore as compared to Rs 2206.94 crore in the corresponding period of previous year.

* Net interest income for year ended March 31, 2018 increased by Rs 215.05 crore (6.77 per cent) to Rs 3389.74 crore on a Y-o-Y basis.

* Non-Interest income stood at Rs 1506.06 crore during the period ended 31.03.2018. This is despite lower profit from sale of investments in light of adverse interest rate scenario during the year ended March 2018.

* Robust increase in recovery in written off accounts by 266.28 per cent to Rs 138.49 crore in period ended March 31, 2018 over comparable period of previous year.

* Net loss of the Bank stood at Rs 1145.63 crore for the Year ended for March 31, 2018, as against net loss of Rs1372.51 crore in period ended March 31, 2017. For Q4 of FY18 net loss of the Bank stood at Rs 113.49 crore, as against net loss of Rs455.45 crore in Q4 of FY17.

* Cost of deposits has come down by 74 bps for the year ended March 31, 2018 (5.31 per cent) in comparison to the year ended on March31, 2017 (6.05 per cent).

* Net Interest Margin (NIM) improved to 2.32 per cent for FY 2017-18 as compared to 2.16 per cent for FY 2016-17.

* Cost to income ratio in FY18 declined by 574 basis points over the previous year to 55.24 per cent from 60.98 per cent.

Business:

* Total business stood at Rs233626.38crore as on 31.03.2018 showing a marginal growth of 2.13 per cent on Q-o-Q basis.

* As on 31.03.2018 total deposits stood at Rs138981.18 crore & Gross advances stood at Rs94645.20 crore.

* Retail advances have grown by 22.24 per cent to Rs 16,547 crore mainly on account of handsome growth in Housing Loans (26.28 per cent), Vehicle Loans (8.94 per cent). Share of retail advances in the loan book has improved by 3.26 per cent (Y-o-Y) to 17.48 per cent.

* CASA deposits constitute 47.74 per cent of total deposits.

NPA Management:

* Recovery in FY 2017-18 was Rs 1765 crore as compared to Rs 810 crore in the last year. Recovery in Written off accounts in FY 2017-18 was Rs 138.48 Crore as compared to Rs 37.81 Crore in the previous year

* The Bank has shown consistent efforts in arresting fresh slippages, which have come down to Rs5144 crore for the year ended March 31, 2018 as compared to Rs 9035 Crore for the corresponding period in previous year.

* Slippages in Q4 of FY18 was Rs1660 crore against Rs3522crore in corresponding period of previous year.

* Gross NPA stood at Rs, 18433 crore (19.48 per cent of gross advances) and Net NPA stood at Rs 9641crore (11.24 per cent of net advances) as on March 31, 2018.

* Provision Coverage Ratio has improved by 14 percentage points to 58.71 per cent as on March 31, 2018 from 44.48 per cent as on March 31, 2017.

Capital Adequacy:

* As on 31.03.2018 CRAR stood at 11.00 per cent (CET1 ratio 8.97 per cent) against the minimum regulatory requirement of 10.875 per cent (CET1 ratio 7.375 per cent) as per Basel III guidelines.

* During the FY 18, the Bank raised Rs 313.55 crore equity capital from the market by way of Qualified Institutional Placement (QIP). Bank has also received capital support of Rs3173 crore from the Government of India.

Way Forward:

With an expected improvement in overall operating environment, especially in the recovery climate in the country, Bank will be able to capture the growth opportunities through better IT intervention and optimisation of the human and physical infrastructure of the Bank.

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