Federal Bank net profit up by 150%; declares 35% dividend

Kochi, May 19 (UNI) The Federal Bank Ltd. today announced a dividend of 35 per cent and said the bank's net profit had increased by nearly 150 per cent to Rs 225.21 crore during 2005-06.

Announcing the audited financial results of the bank, following a meeting of the Board of Directors here, bank chairman M Venugopalan said that the total business during the year grew by 23.32 per cent to Rs 29,615.21 crore.

The total income increased by 17.85 per cent to Rs 1653.48 crore.

The non performing assets of the bank had come down to 0.95 per cent from 2.21 per cent in the previous year.

Retail and SME advances constituted 68.8 per cent of the bank's total advances, with housing loans constituting the major segment in retail loans.

In January 2006, the bank raised Rs 350 crore by fresh issue of 20 Mio shares through the GDR route, listing in the London Stock Exchange. The total net worth of bank stood at Rs 1249.99 crore. The capital adequacy was 13.75 per cent against the regulatory minimum of 9 per cent, he said.

Projecting a 25 per cent growth in 2006-07, Mr Venugopalan said the bank was adopting certain strategic measures to touch a business level of Rs 100,000 crore by 2010-11.

Identifying SME and retail segments as the areas of growth, Mr Venugopalan said micro financing, tailor made lending schemes and extensive marketing of retail products were among the areas it will focus on.

The bank was planning to open 58 new branches this year and a representative office in the UAE, which would help in an aggressive penetration of the NRI segment. The NRI deposits constituted 27.5 per cent of the total deposits.

The bank had also signed an agreement with Infosys to shift its entire operations to Core Banking Solutions by March, 2007.

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