Fourth Quarter Review- Total income during Q4FY"11 rose by 19.70% to Rs. 3532 crore due to healthy growth of 20.36% in Interest Income which reached Rs. 3232 crore. It was further aided by lower cost of deposits and tax breaks from higher NPA (non-performing asset) provisioning.
While Net interest income grew 2.42 % to Rs 1,013 crore (Rs 989 crore), the Non-Interest Income amounted to Rs. 300 crore. Operating Expenses jumped 23.7% to Rs. 2689.17 crore primarily on the back of interest cost which stood at Rs. 2218.96 crore (up 30.82%).
Operating Profit for Q4 FY"11 stood at Rs. 843 crore as against Rs. 777 crore in Q4 FY"10 registering a YoY growth of 8.50%. Provisions (other than tax) and Contingencies escalated by 34.27% to Rs. 560.49 crore (Rs. 417.43 crore).
Tax expenses went down 220.59% to result in a gain of Rs. 51.19 crore. Thus, Net Profit of the Bank recorded a YoY growth of 5.24% to reach Rs. 334 crore for Q4FY"11 as compared to a profit of Rs. 317 crore in Q4 FY"10. EPS improved to Rs. 13.24 from Rs. 12.65 in previous quarter.
Fiscal Review- Total income during FY"11 rose by 13.88% to Rs. 13047.89 crore due to healthy growth of 17.85% in Interest Income which reached Rs. 12088 crore. While Net interest income grew 43.68% to Rs 4178 crore (Rs 2907 crore), the Non-Interest Income amounted to Rs. Rs.960 crore. Operating Expenses jumped 8.49% to Rs. 9802.75 crore (Rs.9035.67 crore).
Operating Profit for FY"11 stood at Rs. 3245.14 crore as against Rs. 2421.5 crore in FY"10 registering a YoY growth of 34.01%. Provisions (other than tax) and Contingencies escalated by 47.86% to Rs. 1206.53 crore (Rs. 815.98 crore).
Tax expenses went up 13.78% to Rs. 535.74 crore. Thus, Net Profit of the Bank recorded a YoY growth of 32.45% to reach Rs. 1502.87 crore for FY"11 as compared to a profit of Rs. 1134.68 crore in FY"10. Earnings per share improved to Rs. 59.90 from Rs.45.29.
The board of directors recommended a dividend of 104% (Rs. 10.4 per share of Rs. 10 each) for 2010-11. OBC had paid a dividend of 91 per cent on equity shares for 2009-10. The NPA provision for 2010-11 stood at Rs 934.37 crore as compared with Rs 531.60 crore for the previous year.
Net interest margin (NIM) of the bank as at end March 2011 stood at 3.18 per cent from 2.56 per cent in end-March 2010. The NIM was boosted by a 50 basis point drop in cost of deposits and a 12 basis point increase in yield on advances.
The bank also observed a decline of 54 bps in cost of deposits to 6.03%. The Capital adequacy Ratio (Basel II) stood at 14.23%. According to Mr Paydah, MD and Chairman, OBC looks to achieve deposit growth of 22 per cent and credit growth of 25 per cent for the current fiscal.
OBC allotted 4.12 crore shares to the government of India on a preferential basis in return for Rs 1,739.99 crore fund infusion. As a result, the Government of India"s holding has increased to 58% from 51.09%.
The proposed capital infusion is to enhance the lending capacity of the state-owned banks to meet the credit needs of the economy in order to maintain and accelerate the economic growth momentum.