Maintaining higher provisioning requirements due to regulatory compliance, J&K Bank posted a net profit of Rs 494.11 crore in the second quarter of the current fiscal, keeping it on track to meet its annual market guidance, the bank said in a statement here.
Net profit for the first half rose to Rs 978.95 crore, compared to Rs 966.41 crore in the same period of last fiscal.
The bank had made a net profit of Rs 551 crore in the July-September period of the previous fiscal.
Total revenue rose to Rs 3,447 crore in the quarter under review, compared to Rs 3,420 crore in the same period a year ago, J&K Bank said in a filing with the regulator.
Reflecting stable core operations, the bank’s net interest income (NII) for the first half rose marginally by 3.4 percent year-on-year to Rs 2,899.43 crore, while the NII for the second quarter stood at Rs 1,433.99 crore. In line with its market guidance, the bank maintained its NIM at 3.64 percent during the first half. The bank’s other income for the first half stood at Rs 405.19 crore, while the cost-to-income ratio for the half year stood at 60.80 percent, the statement said. The bank’s MD and CEO Amitava Chatterjee said that despite widespread disruptions during the first quarter after the Pahalgam incident and extensive damage caused by floods in the second quarter, “the overall growth we have registered is both encouraging and reassuring”.
“While profitability for the second quarter was muted due to an additional impairment provision of Rs 92 crore made during the quarter in accordance with regulatory requirements, the performance has been better than expected under the challenging conditions,” he said.
The bank has made a total provision of Rs 180 crore for the Jammu and Kashmir Grameen Bank during the first two quarters of the current financial year. Excluding the impact, the bank’s profitability in the first half of the year would be more than 15 percent on an annual basis.
The statement said that despite a difficult situation due to the Pahalgam attack in the first quarter and subsequent floods and landslides in the second quarter, the bank has achieved further stability in the quality of its assets.
During the reporting quarter, the bank’s gross NPA ratio fell by 18 basis points quarter-on-quarter to 3.32 percent and declined by 63 basis points year-on-year, compared to 3.95 percent in September 2024, the bank said.
The net NPA ratio also declined by 9 basis points year-on-year to 0.76 percent from 0.85 percent, while it declined by 6 basis points from 0.82 percent in the June quarter of the current fiscal, the statement said.
The bank’s Provision Coverage Ratio (PCR) remained above 90 percent, while return on assets (RoA) stood at 1.17 percent for the half-year.
On the bank’s asset quality, the MD & CEO expressed optimism: “With a GNPA of around 3.30 percent at mid-year, I believe our progress on asset quality is stable.”
“And with our robust and focused risk management practices, I remain optimistic of achieving our annual guidance of less than 3 percent GNPA by the end of the financial year. Moreover, our PCR is also healthy at 90.39 percent,” Chatterjee said.
On business growth, the bank said during the quarter under review, its deposits recorded a growth of 10.23 per cent year-on-year reaching Rs 15,2,030 crore, while net advances rose 9.38 per cent to Rs 10,5,153 crore, compared to Rs 96,139 crore last year.
The bank’s CASA (savings account to current account) ratio increased by 18 basis points in sequential terms from 45.71 percent in the first quarter and stood at 45.89 percent in the second quarter, remaining one of the highest in the industry, the statement said.
“With nearly 10 percent year-on-year growth in business numbers reaching Rs 2.57 lakh crore, our performance in the second quarter showcases the bank’s operational discipline,” the MD & CEO said.
He said deposit growth is on par with the industry average, while progress, mainly driven by the agri/corporate segments, has seen good credit growth, both on a sequential and annual basis.
Our CASA ratio also showed a slight increase to 45.89 percent on a sequential basis, underscoring our commitment to sustainable quality growth, he added.
Chatterjee said that despite tough challenges, this steady performance in the first half of the financial year confirms my confidence that we are well on track to achieve our annual growth rates.
The bank’s Capital Adequacy Ratio (CAR) for the July-September quarter stood at 15.27 percent, compared to 14.99 percent a year ago.
The MD & CEO said that with a CRAR of over 15 percent, we remain well capitalized and positioned to support future growth opportunities while maintaining financial discipline.
On the bank’s growing operational focus in the rest of the country, the MD & CEO said the bank continues to implement the policy of expanding its operations beyond J&K, strategically partnering with top companies across India.
At the same time, with greater engagement of the bank’s leadership with the customer base in these regions, we are sharpening our focus on building a profitable niche in the retail landscape outside J&K, especially in the personal banking/finance segment, he said.
Chatterjee said all these initiatives are tangible markers of the transformation currently underway at the bank.
However, the foundation of our progress rests on a solid trinity: our people, our processes and our technology. And we are steadily strengthening all these pillars so that efficiency, resilience and excellence remain at the core of every facet of our operations, he added.
#Bank #Results #Net #profit #declines #crore