Mumbai, Jul 28 (UNI) State-run Bank of India surged 3.33 per cent to close at Rs 294.85 after it posted a more-than-expected increase of 78.41 per cent in its first quarter net profit.
Despite hard pressed growth prospects in the sector due to adverse economic scenario, the bank managed the growth pace by opting partially isolated retail loan business and laying more emphasis on corporate segment during the quarter, BoI Chairman and Managing Director T S Narayanashami told reporters here today.
The bank has posted a net profit of Rs 562 crore for the quarter ended June 30 as against Rs 315 crore in the corresponding period of the previous fiscal. The total income of the bank rose to Rs 4115 crore from Rs 3108 crore.
''We have been much focused on core banking, comfortable net interest income growth, good non-interest income growth irrespective of depreciation, provisioning connected to treasury operation,'' Narayanasami said.
Net interest income (NII) of the bank grew by 24.71 per cent at Rs 1181 crore from Rs 947 crore. While, non-interest income of the bank, excluding of treasury income, grew to Rs 385 crore from Rs 250 crore.
However, net interest margin (NIM) were uder pressure during the quarter at 3.3 percent as compared to 3.52 percent a year earlier.
''Sustainability of NIM above 3 per cent is something which we have to wait and see,'' Mr Narayanashami said, adding, ''We would see our fee-based income take care of any shortfall in the NIM''.
He said the bank, in which the government holds 64 percent stake, plans to disburse Rs 7200 crore towards farm loans this fiscal compared to Rs 6600 crore last year.
While asked about the monetary stance expected by the Reserve Bank, he said ''it is the right time to see intensified measures on monetary side, which might include hike in cash reserve ratio (CRR) or repo rate or both.'' He said it is being expected that inflation would come down in next two-three months.
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