Bank of India (BANKINDIA) Q4 98/99 earnings summary

Executive summary

• FY99 operating profit rose to Rs 705 crore from Rs 697 crore; net profit fell to Rs 201 crore from Rs 365 crore.

• Deposits grew to Rs 44,430 crore and advances to Rs 24,327 crore; net NPA ratio improved slightly to 7.28% from 7.34%.

Financial highlights

• Total income was Rs 5,164 crore vs Rs 4,516 crore; total expenditure was Rs 4,963 crore vs Rs 4,151 crore.

• Interest income rose to Rs 4,591 crore from Rs 3,936 crore; interest expense rose to Rs 3,181 crore from Rs 2,651 crore; net interest income was Rs 1,410 crore vs Rs 1,285 crore.

• Net profit included a Rs 131.50 crore after-tax benefit from interest on tax refunds withheld by the tax department; excluding this item, reported earnings were materially lower.

• Staff costs included an adhoc Rs 50 crore provision for wage revision; final arrears were still subject to settlement.

Outlook and guidance

• Priorities included quality-focused credit growth, retail banking, lower operating costs, fee income, technology investment and stronger risk management.

• Expansion plans included approved overseas offices in Nairobi, Shanghai and Qatar, a wholly owned Trinidad and Tobago subsidiary, and a Tanzania joint venture with Bank of Baroda.

• Entry into insurance and housing finance was under consideration; technology plans included a network linking 10 cities and 270 branches and centralized data processing.