Canara Bank, however, recorded a 17 per cent increase in its total income at Rs 4,502.27 crore in the fourth quarter as against Rs 3,836.71 crore in the previous fiscal quarter.  The decline in the net profit was mainly due to higher interest expenditure of Rs 714 crore during the quarter while interest earned went up by Rs 578 crore.

Bank pointed out that the cost of deposits has gone up by 134 per cent, the yeild on assets went up only by 127 per cent.

Higher provisioning

For full fiscal ended March 31, 2008, the bank’s net profit, (after making a total provision of Rs 1,394 crore) clocked a growth of 10.14 per cent at Rs 1,565 crore over previous fiscal’s Rs 1,429.81 crore. Likewise, the bank’s total income for the full year stood at Rs 16,413.60 crore registering growth of 28.1 per cent over previous year’s Rs 12,815.51 crore.  

Briefing reporters, Chairman & Managing Director M B N Rao, however, attributed the marginal dip in the net profit in the quarter due to the higher provisioning made towards non-performing assets.

Mr Rao also attributed the decline in net profit towards the bank’s concerted efforts at strengthening its bottomline rather than chase the topline. He claimed that the bank has been able to protect its margins and thereby improve the profits. 

In this regard he said the bank had consciously kept its deposits and advances at reasonable ratios towards improving its asset and liability structure.  Mr Rao said, in sync with the bank’s strategic focus, the bank’s core deposits, comprising retail and CASA (current account low cost savings account), recorded a robust growth of 25 per cent during the year.

The bank, he said, has added an incremental CASA deposit of Rs 3,640 crore. Consequently, the ratio of CASA deposits to aggregate domestic deposits improved by 40 basis points to 32.39 per cent as on March 2008, he added.  Furthermore, he pointed out that, the bank’s conscious decision to shed high-cost deposits by about 24 per cent had a moderating impact on its aggregate deposits which grew by Rs 11,691 crore to touch Rs 1,54,072 crore.

Vijaya Bank profit drops 72 per cent

 Vijaya Bank , on Wednesday , announced that the banks net profit for the quarter ended on March 31, 2008 dipped 72 per cent to Rs 17.78 crore as against Rs 63.65 crore in the quarter ended 31 March,2007. The Bank did not announced its net income for the last quarter.

Announcing the results here,  Vijaya Bank Managing Director Prakash P Mallya said that the drop in profit in the fourth quarter was mainly  due to the provisions made for incremental marked to market (MTM) dimunition in the value of investments to the tune of Rs 272.12 crore.

“It happened due to adverse movement in bond yield and volatility in the equity market during the last fortnight of the quarter,” Mr Mallya said.

Annual profit up

Vijaya Bank on Saturday also announced net profit of Rs 361.26 crore for the financial year ended March 31, 2008, a growth of 9.03 per cent over the corresponding period a year-ago. The total business of  Vijaya Bank rose to Rs 79,971 crore in 2007-08 from Rs 62,248 crore in the previous year. During the year total deposits increased by 27.52 per cent to Rs 47,952 crore as against Rs 37,604 crore in 2006-07.

Expressing his confidence of faster growth, Mr Mallya said that Vijaya bank plans to reach total business of Rs 1,00,000 crore and achieve a credit deposit ratio of above 70 per cent  by March 2009.

 “Our corporate goal for 2008-09 fiscal is profitability powered by cost efficiency. We plan to reach 1150 branches net work in the coming fiscal and to bring all the branches under core banking solution,” Mr Mallya added.