Karur Vysya Bank Q2 results: Net profit up by 52%

Reduction in NPA (lowest in last 24 quarters) and higher NIM (highest in last 18 quarters) have resulted in improved profitability.      

Karur Vysya Bank Q2 results: Net profit up by 52%
Mr. B. Ramesh Babu, MD & CEO, KVB

Chennai:  Karur Vysya Bank (‘the Bank’) announced its financial results for the Quarter / Half year ended September 30, 2022 today. The Bank has delivered a consistent robust performance in terms of profitability (highest ever) and asset quality (Net NPA reduced to 1.36% from 2.99% YOY).

Reduction in NPA (lowest in last 24 quarters) and higher NIM (highest in last 18 quarters) have resulted in improved profitability. 
    
Highlights of business performance 

  • Total business as on 30th September 2022 stands at Rs. 1,35,460 crore, registering a Y-o-Y growth of 13.58% i.e. up by Rs. 16,200 crore from Rs. 1,19,260 crore as on 30.09.2021. Total business stood at Rs. 1,26,226 crore as on 31.03.2022. The Total business doubled in a decade. 
  • Credit portfolio grew by ~15% Y-o-Y (Rs. 7,996 crore) and gross advances stands at Rs. 61,846 crore as on 30.09.2022, up from Rs. 53,850 crore a year ago. 
  • Credit off take continues to improve both Y-o-Y as well as Q-o-Q terms aiding the growth of advances portfolio. 
  • Jewel Loan portfolio registered a Y-o-Y growth of Rs. 1,992 crore (~15%) and stands at Rs. 15,465 crore as on 30.09.2022 (up from Rs. 13,473 crore a year ago). 
  • Total deposits grew by Rs. 8,204 crore (~13%) to Rs. 73,614 crore, up from Rs. 65,410 crore as of 30.09.2021. CASA portfolio and retail term deposits were growth drivers. 
  •  CASA deposits are up at Rs. 25,913 crore i.e. a growth of 11.89% on Y-o-Y basis (Rs. 23,160 crore a year ago). 
  •  Basel III CRAR stands at 18.31% (with CET1 Ratio of 16.42%), 18.82% as on 30.09.2021. 
  •  As at 30.09.2022, Gross NPA has declined to 3.97% (Rs. 2,457 crore) as compared to 7.38% (Rs. 3,972 crore) a year ago. GNPA as on 31.03.2022 was Rs. 3,431 crore (5.96%). 
  • Net NPA stands at 1.36% (Rs. 819 crore) as on 30.09.2022 (2.99% a year ago - Rs. 1,538 crore). 
  • Provision Coverage Ratio stands at 86.94% (76.28% a year ago). 
  •  Branch and ATM + Cash Recyclers network as on 30.09.2022 stands at 792 & 2,238 respectively (corresponding position was 781 & 2,234 as on 30.09.2021). 

Financial performance Q2 FY 2022-23 

  • Net profit for the quarter grew by 52% and stood at Rs. 250 crore from Rs. 165 crore during Q2 of previous year. 
  • Operating profit for the quarter was Rs. 572 crore as compared to Rs. 375 crore for Q2 of previous year. 
  • Net interest income for the quarter improved by ~21% (Rs. 141 crore) to Rs. 821 crore for the current quarter vis-à-vis Rs. 680 crore for Q2 of previous year. 
  • Net interest margin stands at 4.07% up 33 bps from 3.74% a year ago. 
  • Cost of deposits has improved by 24 bps and stands at 4.08% as compared to 4.32% during the previous year. 
  • Yield on advances is at 8.55% (8.62% for Q2 of previous year). 
  • Non-interest income for the quarter is Rs. 242 crore during the current quarter as compared to Rs. 165 crore a year ago. 
  •  Fee-based income has improved by Rs. 30 crore on Y-o-Y basis to Rs. 174 crore from Rs. 144 crore during the previous year. 
  •  Operating expenses for the quarter was Rs. 491 crore as compared to Rs. 470 crore during Q2 of previous year. 
  • Cost to income ratio stands at 46.16% (55.57% for Q2 of previous year). 

Financial performance – Half-year ended 30th September 2022 

  • Net profit for the half year registered a robust growth of 74.8% (Rs. 205 crore) and stood at Rs. 479 crore from Rs. 274 crore during corresponding period of previous year. 
  • Operating profit for the half year was at Rs. 1,048 crore, as compared to Rs. 787 crore for H1 of the previous year. 
  • Net interest income for the half year increased by 18.9% to Rs. 1,567 crore vis-à-vis Rs. 1,318 crore for H1 of FY 2021-22. 
  • Net interest margin stands at 3.95% up by 30 bps as compared to 3.65% during the first half of the previous year. 
  • Cost of deposits has improved by 33 bps and stands at 4.09% as compared to 4.42% during the H1 of previous year. 
  • Yield on advances is at 8.41% as compared to 8.59% during the first half of the previous year. 
  •  Commission and fee based income has improved by 24.5% (Rs. 71 crore) on Y-o-Y basis to Rs. 361 crore from Rs. 290 crore for H1 of the previous year. 
  • Operating expenses for the half year was Rs. 960 crore as compared to Rs. 899 crore during first half of FY 2021-22. 

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