Mumbai, June 27: Vysya Bank has recorded a 15 per cent growth in its net profit for the year ended March 31, 1998, to Rs 75.52 crore, compared with Rs 65.70 crore in the previous year. The board of directors of the Bangalore-based private sector bank have recommended a dividend of Rs 5.50 per share of Rs 10, subject to the Reserve Bank of India approval.The bank has decided to transfer a sum of not less than 0.05 per cent of standard loan assets at the end of each financial year into a special reserve account. "This is expected to meet the contemplated prescription of stricter prudential norms in future," a Vysya Bank release said. The State Bank of India was the first to provide for its standard assets followed by Allahabad Bank. Both the banks have made .25 per cent provisioning for standard assets.
Despite low credit offtake during the year, the investment and treasury operations of Vysya Bank contributed Rs 63.46 crore which helped shore up the bank's bottomline. The bank's investments increased by9.6 per cent to Rs 2,086 crore while the average yield on investments was at 12.52 per cent.
Vysya has marked 75 per cent of its investment portfolio to market against the RBI norm of 60.
Net credit during the year stood at Rs 2,573 crore while deposits grew by Rs 680 crore to reach Rs 5,749 crore. The advances to the priority sector stood at Rs 1,137 crore constituting 44.18 per cent of total credit against the RBI norm of 40 per cent. Export credit during the year constituted 22.81 per cent which far exceeded the target of 12 per cent.
The bank's foreign exchange business recorded a turnover of Rs 26,685 crore, netting a profit of Rs 15.78 crore. During the year, Vysya Bank launched its Vysflexi Deposit and Vysunit Deposit schemes. Four loan products -- Vysvyapar, Vysrent, Vystax and Vysmobile -- were launched during the year. The bank also launched a credit card -- Vysya Bank Citibank Credit Card -- a co-branded card in association with Citibank.
Vysya Bank plans to leverage its strategicpartnership with Bank Brussels Lambert (BBL), which has a 10 per cent equity stake in the bank, through a foray into project financing of large corporates and multinational companies. During 1997-98, the bank diversified its credit portfolio by entering into infrastructure financing with a total line of credit commitment of Rs 220 crore. The networth of the bank has risen to Rs 485 crore which includes revaluation reserves of Rs 12.45 crore. The earnings per share has risen to Rs 47 while the book value on each share is now at Rs 294. The capital adequacy of Vysya Bank as on March 31, 1998, stood at 12.48 per cent.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
