Bank of India (BANKINDIA) Q4 01/02 earnings summary

Executive summary

• FY02 business crossed ₹1 lakh crore, up 16.95%; net profit doubled to ₹505 crore and operating profit rose 82.9% to a record ₹1,412 crore.

• Despite economic slowdown, domestic gross advances grew 18.77%, above the 15.15% industry average; directors recommended a record 25% dividend.

Financial highlights

• Total income rose 8.63% to ₹6,712 crore; total expenditure declined 1.98% to ₹5,300 crore.

• Interest income increased to ₹5,609 crore from ₹5,317 crore; other income rose 28% to ₹1,103 crore, including ₹431 crore profit on investment sales.

• Net interest income grew 11% with spread broadly maintained; operating expenses fell 12.21% to ₹1,531 crore.

• Profit before the extraordinary item was ₹508.83 crore; after ₹124.05 crore interest paid on returned government capital and ₹120.44 crore dividend adjustment, reported net profit was ₹505.22 crore.

• Deposits grew 15.54% to ₹59,711 crore; gross credit rose 19.08% to ₹40,566 crore and investments increased 21.17% to ₹22,084 crore.

Outlook and guidance

• FY03 targets: operating profit of ₹1,650 crore and net profit of ₹700 crore.

• Net NPA target is below 4%; higher NPA coverage was targeted for March 2003.

• Credit demand was expected to pick up later in Q3 FY03 as economic sentiment improved.

• Plans included 30 new branches and 15 extension counters in FY03, with priority for commercial, personal, housing-finance and SSI banking.