Bank of Maharashtra Q2 profit jumps 41.5% as bad loans decline

Bank of Maharashtra’s second-quarter profit rose 41.5% to Rs 2,310 crore, as higher income, strong credit growth and declining bad loans boosted performance.

The bank's return on assets improved to 2.02 % for the second quarter from 1.82% a year prior.

"We are now in the 2% club and we will take steps to maintain RoA at 2% plus," managing director Nidhu Saxena said.

The state-owned lender's operating profit stood 31% higher at Rs 3,369 crore against Rs 2,574 crore for the corresponding quarters, riding on 22% increase in net interest income at Rs 3,954 crore and 34% surge in non-interest income at Rs 1129 crore.

The provision and contingencies were lower at Rs 654 crore for the quarter against Rs 756 crore a year prior even after making an additional Rs 500 crore provision as a preparation for the credit loss regime from next fiscal.

Its gross non-performing assets ratio improved to 1.25% at the end of September from 1.72% a year prior. Net NPA ratio improved to 0.12% from 0.18%. It maintains provision coverage ratio around 98%.

The bank's total deposits increased by 21.5% year-on-year to rs 3.76 lakh crore while credit grew by 29.6% to Rs 3.29 lakh crore at the end of September.

Private sector lender Tamilnad Mercantile Bank reported a 42% year-on-year jump at Rs 451 crore for the July-September quarter as against Rs 318 crore in the year ago period. Its operating profit stood 42% higher at Rs 642 crore against Rs 452 crore. The bank's asset quality improved with gross non-performing assets falling to 0.61% at the end of September from 1.01% a year prior. Net NPA improved to 0.14% from 0.26% over the same period.

Dhanlaxmi Bank reported a net profit of Rs 48.6 crore for the second quarter against Rs 23.2 crore in the year-ago period, registering a 110% surge. Operating profit for the quarter stood at Rs 69.8 crore, growing 148% year-on-year over Rs 28.2 crore. Its asset quality improved with gross non-performing assets falling to 1.76% at the end of September from 3.1% a year prior. Net NPA improved to 0.45% from 1.12% over the same period.