South Indian Bank's Q2FY24 earnings: Net profit increased by 23.3% to 275 crore and NII increased by 14.3%

 South Indian Bank's Q2FY24 earnings: Net profit increased by 23.3% to 275 crore and NII increased by 14.3%

In its Q2FY24 financial results announcement, South Indian Bank reported a 23.3% rise in net profit to 275 crore. In contrast, the bank posted a net profit of ₹223 crore during the similar quarter last year and ₹202 crore in Q1FY24.

While the net interest margin climbed to 3.33% in Q2FY24 from 2.98% in Q2FY23, net interest income (NII), the difference between interest received from lending and interest paid to depositors, increased by approximately fourteen percent YoY to 830 crore.

Its other revenue increased 39.21% YoY from 255 crore in Q2 FY23 to 355 crore. Pre-provision operating profit climbed from 425 crore in the same period last year to 460 crore this quarter. Provisions for Q2FY24 were 51 crore, down 72% YoY from 179 crore during the same time in the previous year.

The bank's gross non-performing securities (NPA) fell by 71 basis points YoY to 4.96% in Q2FY24 on the asset quality front. Additionally, Net NPA dropped 81 basis points to 1.70%. 

In terms of deposits, the bank's retail deposits increased by $6,337 billion, or 7.3%, year over year, from $87,111 billion to $93,448 billion in Q2 FY24. NRI deposits increased by 1,285 billion to 28,785 billion, or 4.7% YoY, while the CASA expanded by 1.8% in Q2FY24, with growth in savings banks of 1.8% and CDs of 1.7%, respectively.

In terms of advances, the bank recorded the highest-ever advances in Q2 FY24 at 74,947 crore, up 10% from Q2 FY23's 67,963 crore. According to the company's financial report, the corporate sector increased by 6,859 crore to reach 27,491 crore, a rise of 33.2% YoY. 

When reporting the results, the bank's MD and CEO, P R Seshadri, said that the bank's strategy continues to support the success of the company. With a focus on high-quality assets across all verticals, the bank saw growth throughout the period in all the targeted areas, including corporate, SME, auto, credit card, personal, and gold loans.

In accordance with the bank's strategy goal of "profitability through quality credit growth," he said, the bank has been able to onboard new loans with a low risk profile totaling almost 64% of its portfolio since October 2020, or Rs. 48,246 crore, with a GNPA of only 0.18%.