IDBI Bank, one of India’s leading public sector banks, has announced an increase in its net profit by 22% to Rs 1,113 crore in the fourth quarter (Q4) of the fiscal year 2020-21. This growth has been attributed to a significant increase in the bank’s net interest income (NII) and a reduction in its provisions for non-performing assets (NPAs).
The bank’s NII increased by 46.4% to Rs 2,405 crore in Q4 2020-21, up from Rs 1,642 crore in the same quarter of the previous year. The increase in NII was due to a combination of factors, including a growth in advances and an improvement in the bank’s net interest margin (NIM).
Additionally, the bank’s provisions for NPAs decreased by 40.5% to Rs 1,327 crore in Q4 2020-21, down from Rs 2,230 crore in the same quarter of the previous year. This reduction in provisions was driven by a decrease in the bank’s gross NPAs, which declined from 22.37% in Q4 2019-20 to 21.38% in Q4 2020-21.
The bank’s total income also increased by 5.2% to Rs 7,403 crore in Q4 2020-21, up from Rs 7,034 crore in the same quarter of the previous year. This increase was due to a growth in both interest income and other income.
IDBI Bank’s Managing Director and CEO, Rakesh Sharma, expressed his satisfaction with the bank’s Q4 results and highlighted the bank’s commitment to continued growth and profitability. He said, “We are delighted with the strong performance of the bank in the fourth quarter of FY21. The improvement in profitability was driven by a significant increase in net interest income and a reduction in provisions for NPAs. We remain committed to achieving sustainable growth and profitability in the future, while maintaining our focus on asset quality and risk management.”
The bank’s board of directors has recommended a dividend of Rs 0.80 per share for the financial year 2020-21, subject to approval by the shareholders at the bank’s upcoming annual general meeting.
Overall, IDBI Bank’s Q4 results indicate a strong performance for the bank in the face of challenging economic conditions. With its focus on sustainable growth and profitability, IDBI Bank is well-positioned to continue its success in the coming years.
