South Indian Bank's Q4 Profits Decline By 14% To Rs 288 Crore; Stock Dips 5%

South Indian Bank saw a tumble of 5.10% in its stock price to Rs 29.20 following the announcement of its financial results for the fourth quarter of fiscal year 2024. The bank reported a standalone net profit decline of 13.88% to Rs 287.56 crore in Q4 FY24 compared to Rs 333.89 crore in Q4 FY23.

Despite the decline in net profit, the bank recorded a notable growth in total income, which surged by 13.04% year on year to Rs 2,620.70 crore during the quarter. Net interest income (NII) also saw a modest increase, reaching Rs 874.67 crore, up by 2.04% on a YoY basis.

However, operating profit witnessed a significant downturn, dropping by 22.8% from Rs 561.55 crore in Q4 FY23 to Rs 433.54 crore in Q4 FY24. Provisions (other than tax) and contingencies stood at Rs 40.62 crore in Q4 FY24, marking a slight increase of 4.18% from Rs 38.99 crore reported in Q4 FY23.

On an annual basis, the bank's net profit recorded a substantial jump of 38.06% to Rs 1,070.08 crore in FY24, with total income rising by 25.88% to Rs 10,128.32 crore over FY23. Net interest income grew by 10.62% YoY to Rs 3,332.06 crore in FY24, with the bank achieving its highest Net Interest Margin (NIM) of 3.31% in the last 18 years.

Despite the decline in profits, South Indian Bank showcased improvements in its asset quality. The gross NPAs to gross advances ratio decreased to 4.50% as of March 31, 2024, compared to 5.14% as of March 31, 2023. Similarly, the net NPA to net advances ratio also witnessed a decline, standing at 1.46% as of March 31, 2024, compared to 1.86% in the previous year.

The bank's retail deposits grew by 9.07% YoY to Rs 97,743 crore as of March 31, 2024, while gross advances increased by 11.56% to Rs 80,426 crore over the same period. Current and savings account (CASA) deposits also saw growth, reaching Rs 32,693 crore, up 8.16% YoY, with a CASA ratio of 32.08% as of March 31, 2024.

Seshadri, Managing Director and CEO of South Indian Bank, expressed confidence in the bank's strategy, noting that it continues to drive business performance. He highlighted growth across all segments with a focus on quality assets, including corporate, SME, auto loans, credit cards, personal loans, and gold loans.

Despite facing challenges in its quarterly performance, South Indian Bank remains optimistic about its long-term growth prospects, backed by its strategic initiatives and focus on asset quality across various verticals.