A 217 per cent rise in provisions over the year-ago quarter brought down the Q4 net profit of State Bank of Travancore (SBT) by 67.63 per cent to ₹62.13 crore. This is despite the good control on total expenditure, which helped it post a 16.91 per cent growth in operating profit to ₹547.47 crore.
A 11.57 per cent growth in other income partially compensated for the muted (2.3 per cent) growth in interest earnings.
The mega provisioning also took away the gains made in tax expenditure (-73.51 per cent) and distorted the rest of the figures, leading to the significant slide in net profit.
Jeevandas Narayan, Managing Director, said that the bank has provided additional prudential provisions over and above RBI stipulations.
This resulted in a 92 per cent increase in provisions during the year. Thus, the provision-coverage ratio has improved to 61.49 per cent as on March 31, 2016.
Annual figuresThe operating profit for the full year rose 31 per cent to ₹1,798 crore (₹1,372 crore in FY15), while net profit growth was almost flat at ₹337.73 crore (₹335.53 crore last year). The operating profit was driven by a 12 per cent hike in net interest income and a 28 per cent surge in fee income.
The board of directors declared 50 per cent dividend (₹5 per share of face value ₹10). The bank has been consistently replacing high-cost and bulk deposits with retail deposits to cut interest costs.
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