InvestorQ : Is it true that Kotak has reported better profits in the Sep-20 quarter by shrinking its loan book?
Sam Eswaran made post

Is it true that Kotak has reported better profits in the Sep-20 quarter by shrinking its loan book?

Answer
image
Moii Chavate answered.
4 weeks ago
Follow

Kotak Bank reported 26% rise in net profits for the Sep-20 quarter at Rs.2184 crore. During the quarter, the Net interest income or NII increased by 17% to Rs.3913 crore while the net interest margin or the NIM stood buoyant at 4.52%. Standalone total income was around 5% higher at Rs.8288 crore in the quarter.

CASA ratio which is the ratio of current and savings accounts to total deposits stood higher by 350 basis points at 57.1%.This is relevant as CASA reflects the short term low cost deposits base of the bank. At the same time, the total advances marginally lower at Rs.204,845 crore. That appears to be an attempt to shrink the loan book size.

During the Sep-20 quarter, Kotak Bank made COVID-related provisions of Rs.1279 crore. The bank’s net NPAs improved further from 0.85% to 0.64% in the quarter on a yoy basis. However, gross NPAs were higher by 23 bps at 2.55% in the quarter.

However, Kotak Bank has disclosed that in the absence of the Supreme Court order on status quo on provisions, the actual effect would have been to push up the gross NPAs to 2.70% and NNPA to 0.74%. Kotak Bank has made provisions for such contingencies.

1 Views