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Indian Overseas Bank has reported 33% growth in net profit at Rs 501.34 crore for
the quarter ended September 2022 (Q2FY2023). The bank has posted healthy 20%
growth in net interest income (NII). The Net Interest Margin (NIM) of the bank
improved to 2.790% in Q2FY2023 compared to 2.51% in the corresponding quarter
of previous year.
On business front, the bank as has posted 9%
growth in business with strong 18% surge in loan book. The asset quality of the
bank was stable in Q2FY2023. Bank has substantially improved the credit to
deposit ratio to 66.0% at end September 2022 from 58.6% at end September 2021.
However, the CASA ratio of the bank has declined to 42.8% at end September 2022
from 42.6% at end September 2021.
Asset quality stable: The bank has maintained stable asset quality in
Q2FY2023.
The Gross NPA ratio has declined to 8.53% end
September 2022 from 9.12% in the previous quarter and 10.66% in Q2 last year.
The Net NPA ratio of the bank rose on sequential
basis to 2.56% end September 2022 from 2.43% a quarter ago, while declined from
2.77% a year ago.
The standard restructured loan book of the bank
stood at Rs 5211 crore end September 2022.
Provision coverage ratio was steady at 90.94% at
end September 2022 compared to 91.86% a quarter ago and 92.00% a year ago.
The capital adequacy ratio of the bank stood at
15.1% with Tier I ratio at 12.1% at end September 2022.
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Asset
Quality Indicators: Indian Overseas Bank
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Sep-22
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Jun-22
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Mar-22
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Dec-21
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Sep-21
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Variation
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QoQ
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YTD
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YoY
|
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Gross NPA (Rs Crore)
|
14726.35
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14919.06
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15298.62
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15426.55
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15665.69
|
-1
|
-4
|
-6
|
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Net NPA (Rs Crore)
|
4148.60
|
3698.12
|
3824.62
|
3586.83
|
3741.21
|
12
|
8
|
11
|
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% Gross NPA
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8.53
|
9.12
|
9.82
|
10.40
|
10.66
|
-59
|
-129
|
-213
|
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% Net NPA
|
2.56
|
2.43
|
2.65
|
2.63
|
2.77
|
13
|
-9
|
-21
|
|
% PCR
|
90.94
|
91.86
|
91.66
|
92.33
|
92.00
|
-92
|
-72
|
-106
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% CRAR - Basel III
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15.14
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14.79
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13.83
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15.41
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15.41
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35
|
131
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-27
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% CRAR - Tier I -
Basel III
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12.11
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11.75
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10.71
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12.94
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12.84
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36
|
140
|
-73
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Variation
in basis points for figures given in percentages and in % for figures in Rs
crore
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Business Highlights:
Loan growth driving business growth: The business of the bank has increased 9% YoY to
Rs 434441 crore end September 2022, driven by 18% surge in advances to Rs
172713 crore. Deposits rose 4% to Rs 261728 crore at end September 2022.
CASA deposits ratio improves: The CASA deposits of the bank rose 5% YoY to Rs
111924 crore at end September 2022. The CASA ratio rose to 42.8% at end
September 2022 compared to 42.6% at end September 2021, while improved from
41.1% a quarter ago.
Margins improve: The bank has showed 15 bps YoY decline in cost
of deposits to 4.11%, while yield on advances improved 47 bps YoY to 7.83% in
Q2FY2023. Thus, the NIM has improved 28 bps YoY to 2.79%.
Book value of the bank stood at Rs 11.2 per share at end September 2022,
while the adjusted book value (net of NNPA and 25% of restructured advances)
was Rs 8.3 per share at end September 2022.
Quarterly Performance
NII rises as NIM improves: Bank has recorded 11% increase in the interest
earned at Rs 4717.61 crore, while interest expenses increased 5% to Rs 2764.25
crore in Q2FY2023. NII improved 20% to Rs 1953.36 crore in the quarter ended
September 2022.
Non-interest income surges: The overall non-interest income jumped to Rs
1134.84 crore in the quarter ended September 2022.
Expenses ratio improves: The operating expenses of the bank increased 19%
to Rs 1594.02 crore, as other expenses moved up 13% to Rs 550.05 crore, while
employee expenses jumped 23% to Rs 1043.97 crore in Q2FY2023. Cost to income
ratio improved at 51.6% in Q2FY2023 compared with 54.1% in Q2FY2022, helping
the Operating Profit to increase 32% to Rs 1494.18 crore.
Provisions and contingencies rise: The bank has showed 31% increase in provisions
to Rs 988.23 crore.
Effective tax rate declined to 0.9% in Q2FY2023 from 1.7% in Q2FY2022. Net
Profit rose by 33% YoY to Rs 501.34 crore during quarter ended September 2022.
Financial Performance H1FY2023:
Bank has posted 27% increase in net profit to Rs
893.51 crore in the year half year ended September 2022 (H1FY2023). The net
interest income increased 18% to Rs 3707.11 crore, while non-interest income declined
27% to Rs 1728.30 crore leading to 1% decline in net total income to Rs 5435.41
crore in H1FY2023.
The operating expenses increased 7% to Rs
2914.86 crore, while provision and contingencies declined 22% to Rs 1618.63
crore, allowing profit before tax to increase 26% to Rs 901.92 crore in
H1FY2023. The cost-to-income ratio rose to 53.6% in H1FY2023 compared to 49.4%
in H1FY2022. An effective tax rate declined to 0.9% in H1FY2023 compared to
1.9% in H1FY2022. The net profit has increased 27% to Rs 893.51 crore in
H1FY2023.
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Indian
Overseas Bank: Results
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Particulars
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2209 (3)
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2109 (3)
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Var %
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2209 (6)
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2109 (6)
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Var %
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2203 (12)
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2103 (12)
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Var %
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Interest Earned
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4717.61
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4254.49
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11
|
9152.35
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8317.66
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10
|
16729.87
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16965.53
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-1
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Interest Expended
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2764.25
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2621.55
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5
|
5445.24
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5188.16
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5
|
10418.73
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11067.03
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-6
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Net Interest Income
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1953.36
|
1632.94
|
20
|
3707.11
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3129.50
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18
|
6311.14
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5898.50
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7
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Other Income
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1134.84
|
836.23
|
36
|
1728.30
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2380.40
|
-27
|
4903.02
|
5559.02
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-12
|
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Net Total Income
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3088.20
|
2469.17
|
25
|
5435.41
|
5509.90
|
-1
|
11214.16
|
11457.52
|
-2
|
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Operating Expenses
|
1594.02
|
1334.67
|
19
|
2914.86
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2721.23
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7
|
5451.25
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5561.72
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-2
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Operating Profits
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1494.18
|
1134.50
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32
|
2520.55
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2788.67
|
-10
|
5762.91
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5895.80
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-2
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Provisions &
Contingencies
|
988.23
|
751.54
|
31
|
1618.63
|
2071.84
|
-22
|
3983.85
|
5056.09
|
-21
|
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Profit Before Tax
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505.95
|
382.96
|
32
|
901.92
|
716.83
|
26
|
1779.06
|
839.71
|
112
|
|
Provision for tax
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4.61
|
6.55
|
-30
|
8.41
|
13.78
|
-39
|
69.52
|
8.24
|
744
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PAT
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501.34
|
376.41
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33
|
893.51
|
703.05
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27
|
1709.54
|
831.47
|
106
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EPS*(Rs)
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1.1
|
0.8
|
|
0.9
|
0.7
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|
0.9
|
0.4
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Adj BV (Rs)
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8.3
|
7.7
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8.3
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7.7
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7.9
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5.9
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* Annualized
on current equity of Rs 18902.41 crore. Face Value: Rs 10, Figures in Rs
crore
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Source:
Capitaline Corporate Database
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