Allahabad Bank net profit soars 14 per cent
Allahabad Bank’s net profit has increased by 14.2 per cent at Rs 750.14 crore as compared to Rs 656.34 crore during the previous fiscal, reports Jaidev Majumdar.india Updated: May 05, 2007 21:08 IST
Allahabad Bank’s net profit has increased by 14.2 per cent at Rs 750.14 crore as compared to Rs 656.34 crore during the previous fiscal.
The Kolkata-based bank’s net profit during the last quarter of 2006-07 dipped to Rs 125.74 crore from Rs 150.50 crore during the corresponding period of the previous fiscal.
Chairman and managing director of Allahabad Bank AC Mahajan said that the cause for the fall in net profit in the last quarter was due to higher provisioning. AllBank has made a provisioning of Rs 200 crore in the last quarter, as against Rs 183 crore in the same previous corresponding period.
The operating profit in the fourth quarter, however, came down to Rs 323 crore from Rs 330 crore in the same period.
Allahabad Bank’s total business crossed the Rs one lakh crore mark and stood at Rs 1,01,458 crore during 2006-07, thereby registering a 29 per cent growth. According to Mahajan, during 2007-08, the bank has set a target of doing a business 1,25,000 crore and incrementally scale it up to Rs 2,00,000 crore over the next three years.
The bank is also eyeing a 25 per cent growth in deposits and 20 per cent in advances during the current fiscal. Allahabad bank has a headroom to raise Rs 1,500 crore as Tier II capital this fiscal but will not raise it in one go.
While gross NPA to gross advances declined to 2.51 per cent as on March 31, 2007 from 3.94 per cent on March 31, 2006, net NPA to net advances stood 1.07 per cent at the end of the fiscal. The higher net NPA has been due to slippages in excess of Rs 500 crore mainly in the areas of agriculture and government sponsored services.
Mahajan added that the bank has already framed a blueprint to enter the reverse mortgage market and a rollout will be announced very soon. "We have sought clarifications from the regulator what category these loans will be clubbed into? Will it be treated as a housing loan or a real estate loan?" Mahajan asked.
Allahabad Bank has applied for authorisation of 167 branches during the year, of which quite a few will be in West Bengal and northern India.
The bank has also taken a conscious decision to restrain approval of personal loans because of its high-risk nature and refrain from the credit cards business. As part of its overseas foray, it has recently opened a branch in Hong Kong but has withdrawn from a similar venture in Kazakhstan.