South Indian Bank, a Kerala-based private sector lender, had an increase in its net profit by 224.95 per cent sequentially to 333.89 crore in the fourth quarter of FY23. The PAT increased by 22.74 per cent YoY. With the highest-ever growth in key verticals for the full year, the lender has reached a watershed moment in its history. In addition, the bank has declared a 30 per cent dividend for its stockholders.
In Q4FY22, the lender’s PAT was 272.04 crore, while in Q3FY23, it was 102.75 crore.
Net interest income (NII) increased by 43.40 per cent YoY to 857.18 crore in Q4FY23. However, sequential growth was only 3.88 per cent. In the March 2022 quarter, NII was 597.74 crore, and in the December 2022 three-month period, it was 825.15 crore.
Furthermore, provisions and contingencies fell dramatically in Q4FY23 to 38.99 crore, compared to 77.71 crore in Q4FY22 and 41.43 crore in Q3FY23.
In terms of asset quality, key indicators improved even further, with gross NPA at 5.14 per cent and net NPA at 1.86 per cent for the March 2023 quarter — compared to 5.90 per cent and 2.97 per cent in the same time last year.
While announcing the results, Murali Ramakrishnan, MD & CEO of the bank, claimed that the bank’s business approach had contributed to the above performance. During the period, the bank was able to record growth in all key categories, with a focus on developing quality assets across all verticals such as Corporate, SME, Auto Loan, Credit Card, Personal Loan, Gold Loan, and so on.
He further said, in line with the strategic intent of the bank viz, “profitability through quality credit growth”, the bank could churn around 58 per cent of its advances portfolio since October 2020 amounting to ₹41,566 crore with a GNPA of only 0.09 per cent.”
Overall, the bank had its highest-ever net profit of 775.09 crore in FY23, as well as its highest-ever NII of 3,012.08 crore. In addition, the lender achieved a record-high CRAR of 17.25 per cent, a record-high net interest margin of 3.30 per cent, and the greatest ever provision coverage ratio of 76.78 per cent in the last 17 years.
In a meeting on Thursday, the bank’s board of directors suggested a 30 per cent dividend, subject to shareholder approval at the AGM. Previously, a 25 per cent dividend was declared in FY19.