R ARIVANANTHAM
CHENNAI, OCT 28
The Thoothukudi-based century-old Tamilnad Mercantile Bank (TMB) on Thursday reported a whopping 37 pe cent rise in net profit at Rs 262 crore for the July-September quarter for FY23 on growth in income and fall in bad loans, said S Krishnan, Managing Director & Chief Executive Officer.
Addressing reporters, he said, the bank had earned a net profit of Rs 191 crore for the same period last year. This is the first quarterly results after the listing of shares of the Tamil Nadu-based bank on bourses last month.
- With RBI recently lifting the restrictions on branch expansion, the bank would cautiously expand its footprint across the nation: S Krishnan, MD & CEO
- Because of the diversified MSME portfolio, we have very low NPA and credit cost is also one of the lowest: MD & CEO
Total income during the quarter rose to Rs 1,141 crore from Rs 1,101 crore a year ago.
TMB’s interest income grew to Rs 997 crore during the quarter as against Rs 950 crore in the same quarter a year ago.
Gross non-performing assets (NPAs) were reduced to 1.70 percent of gross advances as of September 30, 2022 from 3.31 percent by the end of September 2021.
Bank’s Results at a glance (Rs in Crores)
| Parameters | September 2021 (HY) | September 2022 (HY) | Growth
YoY |
| Total Deposits (₹) | 41,022.21 | 43,136.65 | 5.15% |
| Total Advances (₹) | 31,597.66 | 34,876.53 | 10.38% |
| CASA (₹) | 11,439.32 | 13,192.64 | 15.33% |
| Operating Profit (₹) | 688.94 | 763.63 | 10.84% |
| Net Profit (₹) | 392.08 | 496.51 | 26.63% |
| Net Interest Income | 874.75 | 1032.57 | 18.04% |
| Gross NPA (₹) | 1045.26 | 593.34 | -43.25% |
| Gross NPA (%) | 3.31 | 1.70 | -48.64% |
| Net NPA (₹) | 564.95 | 295.97 | -47.61% |
| Net NPA (%) | 1.79 | 0.86 | -51.96% |
| Provision Coverage Ratio | 80.50 | 88.58 | 10.04% |
| ROA | 1.63 | 1.93 | 18.40% |
| ROE | 16.53 | 16.84 | 1.88% |
Net NPAs also came down to 0.86 pe cent from 1.82 percent.
The fall in bad loans ratio helped cut the provisions towards NPAs and contingencies for Q2FY23 to Rs 34 crore from Rs 39 crore a year ago.
The total business of the bank stood at Rs 78,013 crore with a growth rate of 7.43 percent at the end of September 2022.
Net interest margin of the bank stood at 4.47 percent while Provision Coverage Ratio increased to 88.58 per cent.
“All the sectors have done well during the quarter. Sector wise if you look, RAM ((retail, agriculture and MSME) contributes to around 87 percent of our portfolio. Because of the diversified MSME portfolio, we have very low NPA and credit cost is also one of the lowest,” said Krishnan.
Krishnan said the bank will soon sign up with a couple of more life and non-life insurers as their corporate agents to increase its other income.
With RBI recently lifting the restrictions on branch expansion, Krishnan said the management is set to come out with a detailed roadmap on future growth and expansion soon. The bank would cautiously expand its footprint across the nation.
Currently, TMB has 509 branches and bulk of them are located in Tamil Nadu.
