Bank of Maharashtra reports 44% jump in Q2FY25 net profit at ₹1,327 cr

Bank of Maharashtra (BoM) reported a robust 44 per cent year-on-year (yoy) increase in second quarter (Q2FY25) net profit at ₹1,327 crore, with the bottom line being supported by healthy growth in net interest income and other income even as the provision burden for standard/ restructured assets was substantially lower.

The Pune-headquartered public sector bank had reported a net profit of ₹920 crore in the year ago quarter.

Referring to the half-year (H1FY25) net profit touching ₹2,620 crore ( ₹1,802 crore in H1FY24), MD & CEO Nidhu Saxena observed that the Bank is on course to crossing the ₹5,000 crore mark in terms of full year net profit in FY25 (against ₹4,055 crore in FY24).

Net interest income (difference between interest earned and interest expended) in the reporting quarter was up about 15 per cent yoy at ₹2,807 crore ( ₹2,432 crore in the year ago period).

Other income, including fee-based income, treasury income and recovery in written-off account, rose about 19 per cent yoy to ₹792 crore ( ₹668 crore).

Non-performing assets

While provisioning for non-performing assets (NPAs) was almost unchanged at ₹598 crore (₹597 crore), provision for standard/restructured assets declined about 47 per cent yoy to ₹193 crore (₹362 crore).

Net interest margin (NIM) improved to 3.98 per cent against 3.89 per cent in the year ago period. The Bank’s guidance for NIM is 3.75-3.85 per cent for FY25.

Gross Non-Performing Assets (NPAs) position improved to 1.84 per cent of gross advances as at September-end 2024 against 2.19 per cent as at September-end 2023. Net NPAs position too improved a shade to 0.20 per cent of net advances against 0.23 per cent.

Gross advances increased by about 19 per cent yoy to₹2,17,504 crore as at September-end 2024, with RAM (retail, agriculture and MSME) advances and corporate & other advances growing by about 26 per cent and about 9 per cent, respectively.

Emerging opportunities

On the relatively slow growth in corporate advances, Saxena said: “Wherever emerging opportunities are visible, we would like to participate…there are sectors we are bullish on — infrastructure, lease rental discounting, pharmaceuticals, and renewable energy and companies getting PLI (productivity linked incentive).

“The Bank is also looking at tie-ups with some of the term lending institutions…and we would like to participate in project lending and also provide working capital to such projects. We are waiting to see private sector capex to happen in a meaningful manner.”

Total deposits rose about 15 per cent yoy to stand at ₹2,76,28 crore as at September-end 2024. Low-cost CASA (current account, savings account) deposits declined to 49.29 per cent of total deposits against 50.71 per cent in the year ago quarter.

BoM plans to increase its branch network in key growth centres (where there are emerging opportunities) by 1,000 to 3,500 in five years. In the last three years, the Bank added 600 branches.