Kotak Mahindra Bank Q2 profit jumps 51% to Rs 1,724 crore; NII up 25%

Private lender Kotak Mahindra Bank has reported 51 per cent year-on-year growth in its net profit at Rs 1,724 crore for the second quarter ended September 30, 2019, driven by a rise in net interest income.

"The Mumbai-headquartered bank had posted net profit of Rs 1,142 crore in the same quarter last year," Kotak Mahindra Bank said in a filing to the Bombay Stock Exchange.

Uday Kotak-led bank's net interest income (NII), or the core income a bank earns by giving loans, jumped 25 per cent to Rs 3,350 crore in Q2FY20 from Rs 2,676 crore in Q2FY19. Net interest margin (NIM) stood at 4.61 per cent as against 4.19 per cent in the year-ago period.

The other income (non-interest income) increased to Rs 1,224.41 crore against Rs 1,218.06 crore in the year-ago period.

On the consolidated basis, the net profit jumped 38 per cent to Rs 2,407 crore from Rs 1,747 crore in Q2FY19. The bank's contribution to the profit was Rs 1,724 crore, while the subsidiaries and associates' net contribution was 28 per cent of the net profit, Kotak Mahindra Bank said.

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Kotak Mahindra Bank's asset quality declined slightly during September quarter, with gross non-performing assets (NPAs) ratio rising to 2.32 per cent versus 2.15 per cent in the year-ago quarter. Net NPA stood at 0.85 per cent as compared to 0.81 per cent in the corresponding quarter last year.

Capital adequacy ratio of the bank, as per Basel III, stood at 18.2 per cent and Tier I ratio was 17.6 per cent. As on September 30, the bank had a network of 1,512 full-fledged branches and 2,429 ATMs affording it the capacity and means to serve its customers through its wide presence.

The bank's Average Savings deposits grew by 20 per cent to Rs 80,425 crore for Q2FY20 compared to Rs 66,892 crore for Q2FY19. Average Current Account deposits rose by 22 per cent to Rs 33,216 crore versus Rs 27,231 crore in Q2FY19.

During the quarter, the bank launched its very first overseas branch at the Dubai International Financial Centre (DIFC), Dubai, UAE.

Shares of Kotak Mahindra Bank closed trade at Rs 1,628 apiece, up 0.78 per cent, on the BSE on Tuesday.

Edited by Chitranjan Kumar