Date:26/04/2008 URL: http://www.thehindu.com/2008/04/26/stories/2008042655441400.htm

Business

Andhra Bank records Rs. 576 crore net

Special Correspondent

Higher fee-based income contributes to the rise in profit

HYDERABAD: Andhra Bank posted a net profit of Rs. 575.57 crore in 2007-08 against Rs. 537 crore in the previous financial year, a growth of over 7 per cent.

The rise in inflation adversely impacting the bond market yields and decline in the equity markets affected the fourth quarter net profit, said K. Ramakrishnan, Chairman and Managing Director, at a press conference here on Friday.

The net profit dropped to Rs. 124.25 crore in the fourth quarter ended March 31, 2008, from Rs. 138.77 crore in the same period in the previous year. Retail lending dropped from Rs. 2,734.68 crore in 2006-07 to Rs. 2,058.52 crore in 2007-08. The chairman said that the bank consciously brought down the retail lending, besides reducing rates of interest on retail loans thrice in the last fiscal.

Total business of the bank went up by 20.5 per cent to Rs. 83,993 crore from Rs. 69,867 crore, while the bank was expecting to reach the Rs. 1 lakh-crore mark in the current fiscal. The capital-to-risk-weighted assets ratio (CRAR) was pegged at 11.61 per cent against the RBI norm of nine per cent.

The growth in fee-based income from Rs. 40.25 crore to Rs. 84.76 crore perked up the net profit, driven by bancassurance business.