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J&K Bank’s Q2 net up 119% at Rs 243.49 Cr

J&K Bank’s Q2 net up 119% at Rs 243.49 Cr
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SRINAGAR: The J&K Bank’s net profit is 119 percent up Year-on-Year (YoY) at Rs. 243.49 Cr in September Quarter of current financial year.

The official spokesman said that compared to Rs 111.09 Cr recorded for the corresponding quarter previous year its half-yearly (H1) profit rose 90 percent to Rs 409.46 Cr from Rs 215.41 Cr recorded for H1 last year.

The Bank announced its financial numbers after its Board-of-Directors reviewed and approved the quarterly and half-yearly numbers during a meeting held here at Corporate Headquarters.

Performance Highlights

The Bank’s Net Interest Income (NII) is up 24 percent YoY at Rs 1204.12 Cr for the September quarter and 15 percent up at Rs 2238.35 Cr for the half year compared to corresponding periods of previous year, while the Operating Profit rose YoY by 56 percent and 29 percent for respective periods.

The Bank’s NIM has also improved to 4.04 percent against 3.51 percent recorded for the corresponding quarter last year, while as the Return on Assets has improved to 0.71% for the quarter and 0.62 percent for the HY.

The Bank’s steadily moderating cost-to-income ratio has also come down to 64.19 percent for the Q2 from the above 70 percent levels recorded last year.

Commenting on the Bank’s healthy growth, MD & CEO Baldev Prakash said that along with markedly improved bottom-line, the JK Bank’s Q2 numbers reflect Bank’s ability to deliver on its commitments.

“To improve upon all its key financial indicators necessary to redirect its focus on realizing the short-term business goal of Rs 2.2 Lac Cr by the end of current fiscal,” he said.

“While setting the right tone for the future course of our action, I see these numbers heralding a new era of productivity and growth for the Bank and all its stakeholders,” he said.

Improved Asset-Quality

The Gross NPA Ratio has sharply come down 142 basis-points in sequential terms to 7.67 percent from 9.09 percent while as by 128 basis-points on Year from 8.95 percent recorded in September, 2021. The Net NPA ratio has also moderated by over 90 basis-points to 2.10 percent from 3.02 percent recorded a year ago. Provision coverage ratio (PCR) of the Bank has improved to 85.58 percent from 81.57 percent a year ago.

Expressing satisfaction over the Bank’s asset-quality, MD & CEO said, “With single-minded institutional focus on improvement of asset-quality during the September quarter, I feel very proud that we have brought down the GNPA figure to below eight percent % mark – a feat achieved after seven years is like icing on the cake. And with proactive monitoring and management of SMAs, we are on course to deliver what we have assured to our stakeholders.”

He said that JK Bank has a significant share of above Rs 900 Cr in the NPA pie being assigned to NARCL in the first phase with the resolution process of NPAs gathering more steam post activation of the Bad Bank (NARCL).

Business Growth

Deposits and Advances of the Bank have grown by 9% each on YoY basis to Rs 115714.57 Cr and Rs 74549.73 Cr respectively with an increase of 3% and 4% respectively over the June quarter, 2022.

The Bank’s overall business increased to Rs 190264.30 Cr against Rs 174609.19 Cr recorded last year. The Bank’s Yield on Advances has significantly improved to 9.01% for the quarter from 8.34 % while the CASA is slightly down but still near the 55% mark.

“Despite single-digit increase in overall loan-book, we have maintained about 10% growth in advances in J&K and 15% in Ladakh, which form the bulk of our business,” said MD & CEO JK Bank.

He said that with improved operational parameters during the September quarter, It was encouraging to believe that JK Bank will achieve the top-line growth numbers as envisaged in our business plan.

Suitable Capital Cushion

Capital Adequacy (CAR) of the Bank is slightly higher at 12.86 percent against 12.80 percent recorded last year.

“As of now we are adequately cushioned in terms of capital. With an augmented capital (T1 & T2) by fresh infusion of Rs. 1100 Cr and total plow-back of profit (Rs. 500 Crore) during last FY, our CAR for the September quarter is at 12.86% and CET-1 is at 9.99% without inclusion of the Profit after Tax (PAT) for the half-year, which if included would result in further improvement of 55 basis points in these ratios,” said MD & CEO JK Bank Baldev Prakash.

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