MUMBAI: Riding on its net interest income growth, Dena Bank has posted a 20% rise in net profit at 139 crore for the first quarter ended June 30 against 115 crore reported in the corresponding quarter of last year. The net interest income — the difference between the income earned on loans and investments and the interest paid on deposits and borrowings — rose 44% at 360 crore against 250.5 crore in the comparable period last year.
Speaking to media , bank CMD DL Rawal said the bank has asked for a 1,300-crore capital infusion from the government, of which 600 crore is in the form of equity. “In the first phase, we expected to receive 600 crore which will increase government holding from the current level of 51% to 61%,” said Mr Rawal. The capital infusion in the bank will be in over three years and it will take care of a 24% credit growth. The bank’s capital adequacy ratio stood at 11.8%. Net interest margin (NIM) improved to 2.82% from 2.42% a year ago. The bank is aiming at a NIM of 2.81% for 2010-11 .
Non-interest income, however, slipped 31%, mainly because of fall in profit from treasury operations. Due to hardening of yields in the first quarter compared to the corresponding period, profit from sale of securities was down 87% to 9.85 crore against 80 crore in the corresponding period. Profit of fee income also rose 29% to 79 crore and recovery from written-off account stood at 18 crore, up 25%.
Year-on-year advances rose 34% to 37,884 crore while deposits rose 25% to 53,311 crore. On an incremental basis (from April to June 10), advances rose 6% and deposits rose 4.2%. The share of low-cost deposits (current account and savings account) was 36.8% to 19,026 crore as on June 10. For the full year, Mr Rawal said the bank is looking at a 22% growth in credit, 20% growth in deposits and a 23% rise in low-cost deposits.
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