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JK Bank posts Rs 250 cr profit in 3 quarters

Jammu, Jan 12: J&K Bank, the state owned premier financial institution Saturday announced its results for the quarter and nine months ended 31st December 2018 after the reviewed results of the Bank were adopted by the Board of Directors of the Bank in a meeting held at the Jammu.
A spokesperson said the Bank reported a 43% increase in its net profit to Rs 250.09 Cr from April 1 to 31st December 2018 as compared to Rs 174 Cr reported for the same period in previous fiscal.
“For the 3rd quarter the bank posted a profit of Rs 103.75 Cr as compared to Rs 72.47 Cr for the same quarter last year. The growth in J&K Credit has been reported at 22% over the last year and net interest income the difference between interest earned on loans and that paid on deposits grew to Rs 2452 Cr as compared to 2215 Cr in the 09 months period for last financial year,” the spokesperson said.
Expressing satisfaction on the results Parvez Ahmed, Chairman & CEO JK Bank, said in the official communiqué: “The Bank has been able to maintain consistency in its growth rate and earnings. Our focus on expansion of credit in J&K has strengthened our core income with a credit growth rate of 22 % which is spread across all the regions of the state with traction in all the sectors especially retail and SME. We met our third quarter profit estimates despite downgrading the much publicized IL&FS exposure and making adequate provisions, though a number of the banks are still maintaining the account as standard.”
The Chairman said that with this the clean-up is almost complete and recognition cycle is drawing to an end though credit costs will take some more quarters to align to the long term averages due to provisioning pressure on account of IL&FS and ageing of NPAs.
The bank’s total business as on the close of December 2018 stood at Rs 1,57,279 Cr comprising of deposits of Rs 86210 Cr and gross advances of Rs 71069 Cr as compared to Rs 1,36,936 Cr a year ago registering an increase of around 15%.
The Bank reported a stable Net Interest Margin (NIM) of 3.76% largely driven by the bank’s low cost of funds at 4.90% with a CASA contribution of 49%. The NPA coverage ratio though static on a YOY basis and still comparable with the best in the industry, has seen a dip on sequential basis to 65.82 % mainly on account of downgrade of the IL&FS which reflects that the bank has been able to tide over the IL&FS shock without any major deterioration in the balance sheet parameters. The Gross and Net NPA ratios of the bank by and large remained unchanged at 9.94% and 4.69%.