The Karur Vysya Bank (KARURVYSYA) Q4 98/99 earnings summary

Executive summary

• FY99 results reflected 13.8% income growth, but lower net profit and weaker asset quality amid recession and reduced treasury gains.

• Business Today–KPMG ranked the bank among the private sector’s top five and No. 1 among old private sector banks, based on FY98 balance sheets.

Financial highlights

• Total income rose 13.8% to ₹378.36 crore; net profit fell to ₹37.04 crore from ₹43.54 crore YoY.

• Gross profit was ₹61.65 crore vs ₹83.14 crore; prior-year result included substantial treasury income not repeated in FY99.

• Deposits increased 18.7% to ₹2,537.93 crore; advances grew 25.4% to ₹1,447.88 crore, against system credit growth of 12%.

• Interest earned rose to ₹337.62 crore from ₹266.88 crore; other income fell to ₹40.73 crore from ₹65.57 crore, including a ₹7.61 crore net investment-sale loss vs prior-year gain of ₹27.71 crore.

Outlook and guidance

• Planned branch openings included Hyderabad (Abids), Jaipur, New Delhi (Greater Kailash), Thrissur and Chennai (Teynampet).

• Capital adequacy was 14.53%, above the proposed 9% norm for FY00; the stated norm was to be achieved by banks by fiscal year-end.

• Y2K preparations included hardware and software compliance, upgrades to embedded systems and branch contingency plans for manual operations.