IOB reports net profit of Rs 633 crore in Q1, up by 26.6%

New Delhi: Public sector Indian Overseas Bank (IO) on Monday reported a 26.60 percent rise in its net profits for the April-June 2024 quarter at Rs 633 crore.

The city-headquartered bank had registered a net profit of Rs 500 crore during the corresponding quarter of last year.

Total income during the quarter under review grew to Rs 7,568 crore up by 21.54 percent from Rs 6,227 crore registered in the same quarter of last year.

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Total business of the bank during the quarter under review grew by 16.04 percent to Rs 5,28,773 crore from Rs 4,55,664 crore registered in the same period of last year.

For the quarter ending June 30, 2024 the Net Interest Margin stood at 3.06 percent while the Provision Coverage Ratio improved to 96.96 percent registering an improvement of 293 basis points.

The Non-Interest Income grew by 28.64 percent year-on-year to Rs 1,033 crore in Q1 FY'25 as against Rs 803 crore registered in Q1 of last financial year.

The interest income grew by 20.48 percent year-on-year to Rs 6,535 crore during the April-June 30 2024 quarter as against Rs 5,424 crore registered year ago.

The BASEL III Capital Adequacy Ratio improved to 17.82 percent as of June 30, 2024.

Briefing reporters, the bank's Managing Director and CEO Ajay Kumar Srivastava said the increase in net profit because the net income has increased.

"Interest income as well as non-interest income and expenses we have been able to control to a certain extent so, net profit has increased because operating profit has increased.", he said.

To a query, he said the bank has set a target recovery of Rs 5,500 crore during the financial year against last year's total recovery of Rs 4,700 crore.

"I think we will be able to cross Rs 5,500 crore in recoveries this year. Q1 we have made a recovery of Rs 582 crore. Balance in nine months we will be able to recover the remaining Rs 5,000 crore...," he said.

For the quarter ending June 30, 2024 the total recovery of the bank stood at Rs 582.27 crore while recovery made from the technically written off accounts was Rs 311.37 crore.

To another query, Srivastava said the board has approved fund raising of Rs 5,000 crore during the financial year as part of diluting Government of India stake in the bank.

"The board has given its approval for raising capital. We may raise it through QIP (Qualified Institutional Placement) later this year. After this, the Government of India holding is expected to come down by 10-12 percent." he said.

The Gross NPA (Non-Performing Assets) stood at 2.89 percent as of June 30, 2024 as compared to 7.13 percent as of June 30,2023 while Net NPA stood at 0.51 percent as of June 2024 as compared to 1.44 percent as of June 30, 2023.

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