South Indian Bank posts net profit of nearly ₹7 crore in Q4

South Indian Bank has registered a net profit of ₹6.79 crore in the fourth quarter of FY21 against a loss of ₹143.69 crore during the corresponding period of the previous year. The net profit for the entire FY21 is ₹61.91 crore as against ₹104.59 crore of the previous financial year.

Murali Ramakrishnan, Managing Director & CEO said the lower quarterly profit was mainly on account of credit cost on the fresh slippages during the fourth quarter, as a result of additional stress in the economy due to Covid-19 pandemic. “Bank has strengthened the review and monitoring system of the advance portfolio to improve the credit quality and thereby bringing drastic reduction in the slippages and improve upgrades/ recovery,” Ramakrishnan said.

Vision 2024

The bank has come up with a 3-year Medium Term Strategy (Vision 2024) wherein the focus will continue in the areas of MSME and Retail Loans with improved underwriting standards. The technology initiatives will be leveraged to improve the CASA and the technology income in the coming quarters.

The prevailing Covid-19 pandemic has impacted the growth in the business and personal loan segment. “As part of the business strategy to reduce the exposure in the corporate advances, the bank has brought down the share of corporate advances from 28 per cent as on March 31, 2020 to 25 per cent as on March 31,” he said.

The bank has also been able to meet the targeted levels of recovery/ upgrades which has helped in containing the GNPA level despite higher slippages numbers during the year on account of the pandemic. The provision coverage ratio has improved to 58.73 per cent from 54.22 per cent.

The Capital Adequacy Ratio stands comfortable at 15.42 per cent as on March 31. The bank has raised the equity capital during the quarter for an amount of ₹240 crore which strengthened the Common Equity. “The bank plans to raise further capital during FY21-22 to strengthen the capital base,” he added.

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