Tamilnad Mercantile Bank Ltd. (TMB) said its standalone net profit for the first half of FY23 rose 27% to ₹497 crore on account of an increase in credit-deposit ratio and net interest margin, control over slippages and reduction in non-performing assets.
Net interest income rose 18% to ₹1,033 crore, while net interest margin stood at 4.47% (4.04%). Provision coverage ratio rose to 88.50% from 80.50%.
Announcing the results, bank MD& CEO, S. Krishnan said: “We continue to focus on retail, agriculture and MSME (RAM) sector, which stands at 87% and balance is corporate sector advances. So, the risk is diversified.”
“Going forward, we will bring down RAM sector advances to 85% and then to 80%. We are not in a hurry to do it. We are not shutting down on corporates. We will take them on board on case-to-case basis,” he said.
For H1, TMB’s total business increased by 7.43% to ₹78,013 crore, of which advances accounted for ₹43,137 crore.
Gross non-performing assets as a percentage to total advances declined to 1.70% from 3.31% and net NPA to 0.86% from 1.79%.
Stating that the RBI had removed the restriction on opening branches, he said they were planning to open new branches ‘cautiously and carefully.’
Talking about the new initiatives, Mr. Krishnan, said they are in the process of tying up with more insurance agencies to offer life and non-life products, introduce more efficient and convenient e-tax payment systems to customers and take steps to introduce government agency business, among others.
For second quarter, TMB net profit rose 37% to ₹262 crore, while total income rose to ₹1,141 crore from ₹1,101 crore.
The bank’s CFO P.A. Krishnan said interest income for the period rose from ₹950 crore to ₹997 crore and net interest income to ₹509 crore (₹439 crore). Net interest margin improved to 4.40% from 4.06%.
