South Indian Bank has recorded a 33.10% increase in net profit at Rs 54.20 crore in the third quarter ended December 2008 as against Rs 40.72 crore in the same period in 2007. The bank’s net profit for the nine months ended December 2008 has seen a 35.32% growth at Rs 144.50 crore as against Rs 106.78 crore in the same duration in 2007. “This quarter result is the highest profit, the bank has achieved in any quarter in its 79-year history,” said VA Joseph, managing director and CEO. The bank held its board meeting in Coimbatore for the first time, and speaking to reporters soon after announcing the third quarter results, Mr Joseph said the bank is on the right path to reach its profit target of Rs 190 crore in 2008-09.
He said, the growth of the bank is mainly due to the increase in customer base and the company’s conscious decision to maintain asset quality. “The bank’s gross non-performing assets (NPA) ratio continued to be the lowest among its peers,” Mr Joseph said. The gross NPA ratio declined to 1.85% as at December 2008 compared to 2.53% previous year. The net NPA ratio also came down further to 0.39% as at December 2008 as against 0.48% as at December 2007.
“The return on average assets for the Q3 increased to 1.11% compared to 0.98% for the same quarter in 2007,” he said. Mr Joseph further said the bank has set a target to reach five lakh new customers in 2008-09. Currently, the bank has reached 4.2 lakh new customers by D e c e m b e r 2008, out of which 1.5 new account holders are from schools and colleges. “We have a special savings account scheme for children above 12 years of age called SIB Junior, where the children are given ATM cards if they have more than Rs 150 in their account,” Mr Joseph said.
The scheme has been a hit with college and school children and it also helps in cultivating the savings habit among children,” he added. Further commemorating the 80th anniversary of the bank, which would be celebrated on January 29, 2009, the bank has launched a fixed deposit scheme called ‘SIB Eighty Plus.’ The scheme open from January 1 to March 31, where minimum deposit amount is Rs 50,000 offers interest at 11% and senior citizens are eligible for interest at 11.25%. Further, each depositor below the age of 70 years is entitled to get a free accident death insurance cover up to Rs 1 lakh, which does not incur any cost to the depositor.