Mumbai: Fourth largest private sector lender Kotak Mahindra Bank on Tuesday reported a 38 percent jump in consolidated net at Rs 2,407.25 crore on tax gains, but flagged loan growth going ahead given the deepening growth worries.
On a stand-alone basis, its net jumped 51 percent to Rs 1,724 crore.
Joint managing director Dipak Gupta said asset quality issues have arisen in all the segments, including the otherwise resilient retail side as well, forcing it to be cautious about loan growth in the remaining part of the current fiscal.
The bank, which booked a 15 percent growth in advances in the reporting quarter, expects loan growth to slow down to "mid-teens" for the fiscal year, Gupta told reporters.
"There are opportunities of growth as well. We need to price the 70 percent people well and stay away from the risky 30 percent," he said.
The stock of gross non-performing assets grew to 2.32 percent due to a Rs 1,000-crore fresh slippages, from 2.19 percent in the preceding quarter, while net NPAs stood at 0.85 percent.
Gupta said there has been a "gentle uptick" in gross NPAs and the stress is coming from all the segments, adding the stock of loans overdue for 60-90 days is Rs 431 crore which is 0.2 percent of net advances.
The upward movement is both from the retail book, including the secured side and unsecured side, he said.
The bank's tax expense went down to Rs 545.63 crore from Rs 835.79 crore on a consolidated basis as it took the advantage of the new tax regime.
On a stand-alone basis, net interest margin widened to 4.61 percent from 4.49 percent on stable yields and fall in cost of funds, coupled with a jump in low-cost retail deposits. Of this the low cost Casa ratio stood at 53.6 percent, up from 50.2 percent as average savings deposits grew 20 percent to Rs 80,425 crore and average current account deposits grew 22 percent to Rs 33,216 crore.
Net interest income increased 25 percent to Rs 3,350 crore from Rs 2,676 crore Gupta said the bank is confident to get the number in the 4.3-4.5 percent range.
Capital adequacy ratio, as per Basel III stood at 18.2 percent with the tier I ratio at 17.6 percent. Gupta said, the bank's contribution to the net income was Rs 1,724 crore, while the subsidiaries and associates chipping in with 28 percent of the consolidated net income.
Of the subsidiaries, Kotak Mahindra Prime reported Rs 172 crore of net profit; Kotak Securities chipped with a hefty Rs 149 crore; Kotak Mahindra Life contributed Rs 144 crore; Kotak Mahindra Investments contributed Rs 67 crore, Kotak AMC & TC chipped in with Rs 85 crore of profit; and international subsidiaries contributed Rs 34 crore in net income.
In anticipation of the earnings, the Kotak Bank counter closed with 0.78 percent gains at Rs 1,628 on the BSE, whose benchmark Sensex shed 0.85 percent to 38,963.84 points, after six days of rally.
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