Kotak Mahindra Bank profit rises 36% to Rs 2,589 crore in March quarter

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New Delhi: Kotak Mahindra Bank on Monday reported a 36% jump in consolidated net profit to Rs 2,589 crore for the fourth quarter ended March 2021.

The private sector lender had clocked a profit of Rs 1,905 crore in the same quarter of the previous financial year.

The total income rose to Rs 16,175.87 crore during the fourth quarter from Rs 12,084.71 crore in the year-ago period, the bank said in a statement.

During the quarter, the standalone profit also increased by 33% to Rs 1,682 crore as compared to Rs 1,267 crore in the same period a year ago.

On a standalone basis, the total income grew to Rs 8,398.39 crore as against Rs 8,294.07 crore in the year-ago quarter.

The net interest income (NII) increased by 8% to Rs 3,843 crore from Rs 3,560 crore in the same period a year ago. Driven by a surge in bottomline, the board has also recommended a dividend of Rs 0.90 paise per share of the face value of Rs 5 each, out of the net profit for the year ended March 31, 2021.

Its gross non-performing assets (NPAs) or bad loans were 3.22% of the gross loans as of March 31, 2021, slightly up from 2.25% at the March-end 2020. Even the net NPAs registered a marginal increase at 1.23% from 0.71% a year ago.

During the quarter, the bank allocated Rs 1,279 as COVID-19 related provisions, it said.

In accordance with the Resolution Framework for COVID-19 and MSME announced by the RBI, as of March 31, 2021, the bank has implemented, for certain eligible borrowers, a restructuring of Rs 435 crore (0.19% of net advances).

On the COVID-19 impact, it said, the bank continues to closely monitor the situation and in response to this health crisis it has implemented protocols and processes to execute the business continuity plans and help protect its employees and support its clients.

“The pandemic has impacted lending business, distribution of third party products, fee Income from services or usage of debit/credit cards, collection efficiency, etc. and has resulted in an increase in customer defaults and consequently increase in provisions,” the bank said.

The future direct and indirect impact of COVID-19 on bank business, results of operations, financial position and cash flows remains uncertain, it said, adding the standalone financial results do not include any adjustments that might result from the outcome of this uncertainty.

During the quarter, the Supreme Court vacated the stay on NPA recognition and granted relief for interest on interest. The bank has created a liability of Rs 110 crore towards estimated interest relief and has reduced the same from interest earned.