The South Indian Bank (SOUTHBANK) Q4 09/10 earnings summary

Executive summary

• FY2010 net profit reached a record ₹233.76 crore, up 20.1% YoY; total gross business rose 29.69% to ₹38,982 crore.

• Deposits grew 27.19% to ₹23,012 crore and gross advances rose 33.47% to ₹15,970 crore; asset quality improved, with gross NPA ratio at 1.32%.

Financial highlights

• Total income was ₹2,144.18 crore versus ₹1,851.19 crore; interest earned rose to ₹1,935.72 crore from ₹1,686.92 crore.

• Operating profit before depreciation, tax and provisions was ₹427.33 crore; reported net profit was ₹233.76 crore versus ₹194.75 crore.

• Other income was ₹208.46 crore; net profit on investment sales was ₹78.02 crore versus ₹35.41 crore in FY2009.

• Proposed dividend increased to 40% (₹4/share) from 30% (₹3/share), subject to shareholder approval.

Outlook and guidance

• Plan to open 60 branches and 107 ATMs in FY2011, targeting 640 branches and 480 ATMs by March 31, 2011.

• RBI projected FY2011 GDP growth at 8%, WPI inflation at 5.5% by March 2011, M3 growth at 17%, deposit growth at 18% and non-food credit growth at 20%.

• Outlook uncertainties included the 2010 monsoon, volatile crude prices, demand-side inflation pressures, global recovery and the large government borrowing programme.