Indian Overseas Bank (IOB) Q4 03/04 earnings summary

Executive summary

• FY03-04 operating profit reached a record ₹1,325.20 crore, up 66.9% YoY; net profit rose 23.23% to ₹512.76 crore.

• Higher low-cost funding, cost compression and stronger treasury income supported profitability and accelerated provisioning; net NPA ratio fell to 2.85%.

Financial highlights

• Total income increased to ₹4,494.76 crore from ₹4,005.80 crore; interest income rose to ₹3,754.10 crore from ₹3,485.90 crore.

• Non-interest income rose to ₹740.66 crore from ₹519.90 crore; interest expense declined to ₹2,154.69 crore from ₹2,264.44 crore.

• Operating expenses, excluding provisions and contingencies, were ₹3,169.56 crore versus ₹3,211.67 crore; provisions and contingencies were ₹812.44 crore versus ₹378.03 crore.

• Net profit was ₹512.76 crore versus ₹416.10 crore; EPS was ₹10.40 versus ₹9.35.

• Global deposits reached ₹41,482.6 crore and global net advances ₹20,294.9 crore at March 2004, versus ₹36,698.6 crore and ₹17,447.0 crore a year earlier.

Outlook and guidance

• FY04-05 Indian economic growth was forecast at 7–8%, with agriculture expected to benefit from a normal monsoon; industry growth was projected near 7% and services at 8%.

• A final dividend of 8% was proposed, subject to RBI approval, following a 12% interim dividend; proposed total FY03-04 dividend was 20%.