South Indian Bank Q4 net declines 87% to Rs 16 cr

Thrissur-based South Indian Bank recorded an annual net profit of Rs 307.20 crore during 2014-15 as against Rs 507.50 crore during the previous financial year. That's a 39% decline.

During the fourth quater the net profit decreased 87% to Rs 16 crore as against Rs 124 crore in March 2014.

Operating profit decreased by 7.5%, which is Rs 816.27 crore as on 31st March, 2015 as against Rs 882.89 crore in the previous fiscal.

Addressing a press conference here today V G Mathew, managing director and CEO said  that the year was challenging due to stress in corporate credit book especially in sectors like power and infrastructure. The increased provisions on account of stressed assets and provisions towards employee costs, brought pressure on net profit, he added. "The decline in operating profit is due to increased provisioning requirements towards employee benefits based on the recently concluded industry wide wage settlement and actuarial liability on superannuation benefits due to softening of market yield," he added.

The net operating income of the bank increased 5.4% from Rs 1,767.24 cr to Rs 1,863.31 cr. The growth in non interest income was Rs 128.61 cr (34.90%) during the year.

Mathew added that the financial year 2015 was an year of consolidation and the bank has introduced several measures aimed at refocusing on the retail segment for advances as well as deposits with very encouraging results. "During the period, the bulk deposits have been brought down from 29 per cent  to 21.67 per cent and the core deposit recorded an increase of 20.61 per cent and CASA grew by 8.77 per cent. The NRI portfolio also grew commendably at 29.17 per cent," he said.

Similarly on the credit front, loans to agriculture, MSME, home and auto loans grew by 36.18%, 20.32%, 36.41% and 46.41% respectively, during FY 2015. He also stated that the bank has decided to pass on the benefit on account of revision in liability pricing during the last year to the customers and has reduced the Base Rate by 30 Basis points respectively recently.