Tamilnad Mercantile Bank posts .₹303 cr net profit in Q2

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Tamilnad Mercantile Bank (TMB) has reported a net profit of ₹303 crore for the September 2024 quarter, an 11per cent increase from ₹274 crore during the same period last year. This marks the highest quarterly net profit posted by the bank, driven by increased operating profit attributed to growth in net interest income, despite higher provisions.

The Thoothukudi (Tamil Nadu)-based private sector bank saw its operating profit rise by 27per cent to ₹465 crore in Q2 of this fiscal year, compared to ₹365 crore in the corresponding quarter last year. Net interest income grew by 12per cent to ₹596 crore, up from ₹533 crore a year earlier. Total slippages stood at ₹63 crore, while cash recoveries and upgrades amounted to ₹66 crore. Total provisions rose to ₹65 crore, compared to ₹23 crore in the year-ago period.

As of September 30, 2024, the Gross NPA (Non-Performing Assets) as a percentage of total advances declined to 1.37per cent, down from 1.7per cent in the same quarter of the previous fiscal year. The Net NPA also decreased to 0.46per cent, compared to 0.99per cent a year ago.
Total advances grew by 13per cent to ₹42,533 crore, up from ₹37,778 crore, while total deposits increased by 4per cent to ₹49,342 crore from ₹47,314 crore. The retail, agriculture, and MSME (RAM) sectors accounted for 92per cent of gross advances in Q2 of this fiscal year.

Return on assets improved to 1.94per cent in Q2FY24, compared to 1.89per cent a year earlier. The bank’s net worth increased to ₹8,430 crore from ₹7,384 crore.

Managing Director and CEO Salee S. Nair, who recently took charge, stated that his priorities include modernising the bank, driving business growth, and strengthening credit underwriting processes. The bank plans to consolidate credit management into a single centre staffed with skilled professionals, while also revitalising branch roles to enhance deposit generation and lead acquisition. To support these initiatives, TMB is looking to hire approximately 170 professionals, including 45 IT specialists.

Out of the 40 new branches planned for the current fiscal year, 15 have already been opened, with the remaining branches expected to launch soon. Currently, the bank operates over 600 branches across the country.

The company has also finalised the wage agreement. “We have already accounted for the provisions for wage revision, setting aside approximately ₹5 crore per month for this purpose,” stated Nair..