Bank of Maharashtra (BoM) reported a 14 per cent increase in net profit at ₹154 crore in the third quarter ended December 31, 2020, against ₹135 crore in the year-ago quarter.
This came on the back of a healthy increase in non-interest income and reduced loan-loss provision burden.
Net interest income (difference between interest earned and interest expended) increased by 10 per cent to ₹1,306 crore (₹1,186 crore in the year-ago period).
Total non-interest income, including fee-based income, trading income and other income, was up 29 per cent to ₹570 crore (₹442 crore).
Gross non-performing assets (NPAs) declined to 7.69 per cent of gross advances as at December-end 2020 vis-a-vis 8.81 per cent as of September-end 2020.
In absolute terms, GNPAs declined by₹1,033 crore in the reporting quarter.
Loan-loss provisions came down 51 per cent year-on-year to ₹386 crore (₹794 crore in the year ago-quarter).
Net NPA position improved to 2.59 per cent of net advances as of December-end 2020 vis-a-vis 3.30 per cent as of September-end 2020.
The Pune-headquartered public sector bank saw a 54 per cent quarter-on-quarter (q-o-q) increase in the number of accounts moving to the “special mention account (SMA) 2” category (principal or interest payment overdue between 61-90 days) to 14,022, with the outstanding amount rising 106 per cent q-o-q to ₹1,419 crore.
AS Rajeev, MD & CEO, BoM, said of the aforementioned outstanding amount, ₹1,000 crore is due to accounts that were under pandemic-related moratorium and they will be restructured in the current quarter. The bank has already made a provision of ₹110 crore towards these accounts.
The bank is expecting a recovery of about ₹750 crore in the fourth quarter, he added.
BoM’s net interest margin/NIM (net interest income divided by average interest earning assets) improved to 3.06 per cent against 2.86 per cent in the December 2019 quarter.
Rajeev said this is the first time in the last 3-4 years years that NIM has crossed the 3 per cent level.
Provision coverage ratio improved to 90 per cent as on December-end 2020 against 87 per cent as on September-end 2020.
Retail, MSME advances
Advances increased by 12 per cent year-on-year to ₹1,04,904 crore as of December-end 2020. Within advances, retail advances and MSME advances were up 29 per cent and 26 per cent, respectively.
Agriculture advances increased about 6 per cent. Advances to ‘corporate and others’ declined a tad.
Total deposits increased by 14 per cent to ₹1,61,971 crore. The share of low-cost current account, savings account (CASA) deposits improved to 50.91 per cent of total deposits from 50.51 per cent in the preceding quarter.