Small BusinessYes Bank net up 19%
Despite a sharp fall in treasury income compared to the year-ago quarter, private sector lender Yes Bank recorded a 19 per cent growth in net profit to Rs 125 crore for the quarter ended December 31, 2009.
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The bank’s net interest income, or the difference between interest earned and interest paid, grew 70 per cent to Rs 211 crore. Non-interest income fell 33 per cent to Rs 128 crore, mainly due to a sharp fall in treasury income to Rs 28 crore, from Rs 148 crore in the December 2008 quarter.
Net interest margin, that is, the difference between the rate at which a bank lends and the rate at which it raises funds, rose 3.1 per cent from 2.8 per cent. This was mainly due to a 300 basis points fall in cost of funds from 9.6 per cent to 6.6 per cent.
Cheaper funds helped offset the sharp fall in yields on advances from 13.7 per cent for the quarter ended December 31, 2008, to 10.3 per cent.
The bank’s gross non-performing assets (NPAs) were 0.29 per cent of the total loans while net NPAs were 0.09 per cent as of December 31, 2009.
The bank’s capital adequacy ratio as of December 31, 2009, was 16.2 per cent, with Tier-1 capital at 9 per cent.
The bank recently closed a Rs 300-crore issue of lower Tier-II bonds. It plans to raise $150-200 million through a qualified institutional placement of equity and Rs 75-85 crore through a hybrid Tier-1 issue.
The bank’s stock fell 3.98 per cent on the Bombay Stock Exchange to end the day at Rs 272.65 per share.
“The bank achieved record profits second time sequentially on the back of strong and sustainable net interest and exceptional credit growth,” Yes Bank Managing Director & CEO Rana Kapoor said.