Indian Bank reported a substantial 61% surge in net profit to Rs 2,068.49 crore for the second quarter of the fiscal year 2024 (Q2 FY24), driven by a robust 23% increase in net interest income (NII), which stood at Rs 5,741 crore. The bank's total income also saw a significant rise, growing by 25% to reach Rs 15,929.4 crore.
The bank's strong performance was underpinned by a strategic expansion plan that targeted retail, agriculture, and MSME sectors. This strategy, coupled with an emphasis on digital banking, has set the bank on track to achieve its credit growth target of 10-12% for FY24.
The bank also made significant strides in reducing its non-performing assets (NPA). The gross NPA was reduced to 4.97%, while the net NPA improved to 0.60%. This improvement in asset quality was accompanied by a rise in the provision coverage ratio to 95.64%.
In terms of profitability metrics, Indian Bank saw an increase in its return on average assets and equity to 1.06% and 19.90%, respectively. These figures indicate an enhanced capacity of the bank to generate profits from its assets and equity.
Showing steady growth, Indian Bank's total business recorded a year-on-year increase of 10%, hitting Rs 1,13,3091 crore in September 2023. Advances also witnessed a healthy growth rate, increasing by 12% year-on-year to Rs 4,92,288 crore.
The bank's robust financial performance in Q2 FY24 underlines its successful execution of strategic initiatives aimed at sectoral expansion and digital transformation. This has not only resulted in strong profit growth but also improved asset quality and profitability metrics.
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