Central Bank of India Q2 profit rises 21% to ₹1,469 cr on strong NII growth | Company Results

Interest income increased 18.45 per cent Y-o-Y to ₹10,357 crore, supported by a 27.6 per cent rise in interest earned on advances to ₹7,231 crore. Interest expenses rose 13.7 per cent to ₹6,211 crore.

Net interest margin (NIM) improved to 3.01 per cent from 2.89 per cent a year ago. The cost of deposits declined 28 basis points (bps) to 4.60 per cent, offsetting a 49-bp fall in yield on advances to 7.87 per cent.

Operating profit rose 26.99 per cent Y-o-Y to ₹2,268 crore from ₹1,786 crore, as higher NII offset the decline in non-interest income. On a sequential basis, operating profit increased 3.75 per cent from ₹2,186 crore.

Non-interest income declined 6.06 per cent Y-o-Y to ₹1,380 crore, with treasury income falling 31.2 per cent to ₹128 crore from ₹186 crore a year ago. Profit on the sale of investments declined 30 per cent to ₹133 crore, while the bank recorded a loss of ₹87 crore on the revaluation of investments, compared with a loss of ₹51 crore a year earlier.

Recoveries in written-off accounts and other receipts fell 8.2 per cent to ₹617 crore, while fee-based income rose 3.9 per cent to ₹635 crore.

Provisions and contingencies, including income tax, increased 39.4 per cent Y-o-Y to ₹799 crore from ₹573 crore a year ago. However, they declined 7.3 per cent sequentially from ₹862 crore.

Provisions for non-performing assets (NPAs) rose to ₹490 crore from ₹143 crore a year earlier, while provisions on standard assets increased to ₹379 crore from ₹30 crore. These were partly offset by a write-back of ₹336 crore on investments, including security receipts. The tax provision declined to ₹236 crore from ₹259 crore.

Operating expenses increased 9.8 per cent Y-o-Y to ₹3,258 crore, with staff costs rising 9.5 per cent to ₹2,072 crore and other operating expenses increasing 10.5 per cent to ₹1,186 crore. The cost-to-income ratio improved to 58.95 per cent from 62.42 per cent a year ago.

On the asset quality front, the bank’s gross NPA ratio improved to 2.39 per cent at the end of September from 2.60 per cent in June and 3.01 per cent a year ago. The net NPA ratio declined to 0.31 per cent from 0.49 per cent in the previous quarter and 0.48 per cent a year earlier.

In absolute terms, gross NPAs stood at ₹9,109 crore as of September 30, compared with ₹8,827 crore a year ago and ₹9,225 crore in June. Net NPAs declined to ₹1,146 crore from ₹1,364 crore in the corresponding period last year.

The provision coverage ratio improved to 97.16 per cent from 95.86 per cent in June and 96.88 per cent a year ago.

Fresh slippages declined to ₹734 crore during the quarter from ₹939 crore in Q1FY27. The slippage ratio stood at 0.24 per cent on a non-annualised basis, down 6 bps Y-o-Y. However, annualised credit cost increased 32 bps Y-o-Y to 0.53 per cent.

On the business front, global advances grew 29.83 per cent Y-o-Y to ₹3.81 trillion, while global deposits increased 14.41 per cent to ₹5.09 trillion. Total global business rose 20.54 per cent to ₹8.90 trillion.

Corporate advances increased 42.05 per cent to ₹1.19 trillion, while retail, agriculture and micro, small and medium enterprise (RAM) advances grew 21.11 per cent to ₹2.54 trillion.

Retail loans rose 24.49 per cent, with housing loans growing 13.07 per cent and automobile loans increasing 13.09 per cent.

The current account savings account (CASA) ratio declined 218 bps to 44.65 per cent, while the credit-deposit ratio increased to 75.02 per cent from 66.20 per cent a year ago.

The bank’s capital adequacy ratio stood at 17.68 per cent at the end of September, compared with 17.34 per cent a year earlier and 18.28 per cent in June. The Common Equity Tier-I ratio improved to 15.97 per cent from 14.98 per cent a year ago.