Chennai based, Indian Overseas Bank posted a 7.60 per cent increase in net profit at Rs 116 crore for the third quarter of the current financial year which ended on December 31st, 2012, against Rs 108 crore for the corresponding quarter of the previous year.
Net Interest Income (NII) increased to Rs 1381 crore from Rs 1221 crore last year.
The increase in profit was attributed to high cost bulk deposits that matured during the third quarter and it increased non-interest income.
Net interest margin (NIM) stood at 2.51 per cent at the end of the third quarter against 2.61 per cent last year. The bank has made a provision of Rs 436.37 crore against Rs 252.8 crore. However, in terms of percentage, it is lower at 59 per cent against 72 per cent made in the comparable previous year quarter.
The bank's gross NPA (non-performing assets) grew to Rs 3,595.14 crore from Rs 1,599.74 crore, a year ago. It recovered Rs 199 crore in third quarter as against Rs 173 crore, a year ago.
The Central Government has agreed to infuse Rs 1000 crore capital against the requirement of Rs 1500 crore.
In response to RBI's decision to cut CRR by 25 basis points, IOB has decided to lend housing loans at the base rate of 10.5 per cent up to Rs 75 lakh.
At present, the bank lends housing loans up to Rs 30 lakh for 10.50 per cent, which will be expanded to Rs 75 lakh, irrespective of the loan tenure.