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Indian Bank has reported a significant increase in its net profit for the fourth quarter of fiscal year 2024-25, demonstrating robust financial performance. The bank's net profit surged by 32% year-on-year, reaching Rs 2,956 crore, a substantial increase from the Rs 2,247 crore reported in the same quarter of the previous fiscal year. This impressive growth can be attributed to a combination of factors, including higher core income and a marked improvement in asset quality. These factors collectively contributed to the bank's enhanced profitability and overall financial health. The substantial increase in net profit underscores the bank's effective strategies and operational efficiency in navigating the dynamic economic landscape. Furthermore, the improvement in asset quality reflects the bank's prudent risk management practices and effective measures for managing non-performing assets (NPAs). The bank's ability to enhance its core income while simultaneously improving asset quality is a testament to its strong financial management and strategic focus. This performance positions Indian Bank favorably in the competitive banking sector, highlighting its resilience and potential for sustained growth. The bank's commitment to maintaining a healthy financial position is evident in its proactive measures to manage risk and optimize its operations. The reported figures demonstrate the bank's ability to generate strong financial results while adhering to sound banking principles. This consistent performance builds confidence among investors and stakeholders, solidifying Indian Bank's reputation as a reliable and stable financial institution. The bank's focus on sustainable growth and prudent financial management is expected to contribute to its continued success in the long term.
The bank's total income also witnessed a notable increase, rising to Rs 18,599 crore in the fourth quarter, up from Rs 16,887 crore in the corresponding quarter of the previous year. This growth in total income reflects the bank's ability to generate revenue from various sources, including interest income and other banking services. The increase in interest income, which climbed to Rs 15,856 crore from Rs 14,624 crore, played a significant role in driving the overall growth in total income. The bank's Net Interest Income (NII), a crucial indicator of profitability, also improved to Rs 6,389 crore, compared to Rs 6,015 crore in the same quarter of the previous fiscal year. The increase in NII indicates the bank's effectiveness in managing its interest-earning assets and interest-bearing liabilities. This improvement in NII further contributes to the bank's overall profitability and financial stability. The bank's ability to maintain a healthy NII demonstrates its competence in managing its core banking operations and optimizing its interest income. The growth in total income and NII reflects the bank's ability to capitalize on market opportunities and effectively manage its financial resources. This consistent performance in income generation underscores the bank's strong market position and its ability to compete effectively in the banking sector. The bank's focus on expanding its revenue streams and optimizing its interest income is expected to contribute to its continued financial success. The reported figures demonstrate the bank's commitment to delivering value to its shareholders and stakeholders through consistent financial performance.
A key factor contributing to Indian Bank's strong performance is the significant improvement in its asset quality. The bank made notable progress in reducing its Gross Non-Performing Assets (NPAs), which declined to 3.09% of gross advances, down from 3.95% as of March 2024. This reduction in gross NPAs indicates the bank's effective measures in managing and recovering bad loans. The decrease in NPAs improves the bank's overall financial health and reduces the risk of future losses. Similarly, Net NPAs fell to 0.19%, compared to 0.43% at the end of the previous financial year, further demonstrating the bank's progress in improving asset quality. The reduction in Net NPAs indicates the bank's success in resolving and recovering impaired assets. The Provision Coverage Ratio (PCR) rose to 98.10% as of March 31, 2025, up from 96.34% a year earlier, indicating a stronger buffer against potential bad loans. This increase in PCR provides the bank with additional protection against potential losses from NPAs. The bank's proactive measures to improve asset quality reflect its prudent risk management practices and its commitment to maintaining a healthy balance sheet. The reduction in NPAs and the increase in PCR enhance the bank's financial stability and resilience. This improvement in asset quality contributes to the bank's overall profitability and strengthens its position in the banking sector. The bank's continued focus on managing and improving asset quality is expected to contribute to its sustained financial success.
Furthermore, Indian Bank reported a rise in its capital adequacy ratio, which improved to 17.94% from 16.44% at the end of FY24. This increase in the capital adequacy ratio indicates the bank's strong financial position and its ability to absorb potential losses. A higher capital adequacy ratio also enables the bank to expand its lending activities and support economic growth. For the full financial year 2024-25, Indian Bank's net profit increased by 35% to Rs 10,918 crore, compared to Rs 8,063 crore in the previous year. This significant increase in net profit demonstrates the bank's consistent financial performance and its ability to generate strong results. Total income for the year rose to Rs 71,226 crore, up from Rs 63,482 crore, while NII reached Rs 25,176 crore, compared to Rs 23,274 crore the previous year. These figures further highlight the bank's strong income generation and its effective management of interest-earning assets and liabilities. The bank reported a Net Interest Margin (NIM) of 3.51% for the fiscal year ended March 2025. This NIM indicates the bank's profitability from its lending activities and its ability to generate income from its core banking operations. The bank's consistent performance in maintaining a healthy NIM demonstrates its strong financial management and its ability to optimize its interest income.
The Board of Directors has recommended a dividend of Rs 16.25 per equity share of face value Rs 10, subject to shareholder approval at the upcoming Annual General Meeting. This dividend recommendation reflects the bank's strong financial performance and its commitment to rewarding its shareholders. The dividend payout is a testament to the bank's profitability and its ability to generate value for its investors. Additionally, the board approved plans to raise up to Rs 7,000 crore through a combination of equity and bond offerings during FY26. This fundraising plan will enable the bank to further strengthen its capital base and support its future growth initiatives. The proposed fundraising includes equity capital of up to Rs 5,000 crore (including premium) via Qualified Institutional Placement (QIP), Rights Issue, or a combination thereof. This equity fundraising will provide the bank with additional capital to support its lending activities and expand its operations. Further, the bank proposes to raise up to Rs 2,000 crore through the issuance of Basel III Compliant AT-1 Perpetual Bonds or Tier 2 Bonds, in one or more tranches, based on market conditions and capital requirements. This bond issuance will provide the bank with additional capital to meet its regulatory requirements and support its growth plans. The bank's fundraising plans reflect its proactive approach to managing its capital base and ensuring its long-term financial stability.
Source: Indian Bank Q4 profit jumps 32% to Rs 2,956 crore on strong core income and improved asset quality