The share price of CSB Bank surged nearly 8 percent on Monday after the lender posted its highest ever net profit in FY21. The bank recorded an all-time high net profit of Rs 218.40 crore in FY21 as against Rs 12.72 crore in FY20, an increase of 1,617 percent, it said in a regulatory filing.

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For the March quarter, the lender reported a net profit of Rs 42.89 crore as against a loss of Rs 59.70 crore in the same quarter a year ago.

The stock rose as much as 7.8 percent to its day's high of Rs 278 per share on the BSE.

The lender informed that its asset quality improved as the gross non-performing assets (NPAs) fell to 2.68 percent of the gross advances as of March 31, 2021, as against 3.54 percent in the year-ago period. In absolute value, the gross NPAs came in at Rs 393.49 crore versus Rs 409.43 crore a year ago.

Net NPAs also fell to 1.17 percent (Rs 168.81 crore) from 1.91 percent (Rs 216.94 crore), it added. Provisions also fell to Rs 70.95 crore in Q4 as compared with Rs 84.32 crore parked aside in the year-ago period.

For Q4, the lender's advances grew by 27 percent mainly contributed by gold loan growth of 61 percent. Deposits at end of March this year grew to Rs 19,140 crore as against Rs 15,791 crore a year ago, while the advances were up at Rs 14,438 crore as against Rs 11,366 crore, it said.

The total business has grown by Rs 6,421 crore or by 24 percent year-on-year, it said, adding, thus in the centenary year the bank has grown a fourth of the total business it grew in the past 99 years.

"In terms of the overall business, the bank has grown a fourth…We could also open 101 branches in this 101st year of existence. In terms of profitability, we could break all the past records by crossing the Rs 200 crore mark," said C V R Rajendran, managing director, and CEO, CSB Bank.

He said gold loans, two-wheeler loans, agri loans, MSME and SME loans will continue to be the main focus areas of the bank. While digital will be the main mantra, the bank also plans to add close to 200 branches to its network in FY22 so that there is a proper mix of brick and click banking, Rajendran said.

“Particularly in gold loan, we are focusing more on recovery now because whatever we have given at a higher value at that point of time, we have given a margin for those margins which are not paid or the rollovers that are not happening, we are trying to sell the gold through auction. So, that process is carried out," Rajendran said in an interview with CNBC-TV18.

He also expects net interest margin to sustain above 5 percent and added that low cost deposit flow has been strong which is aiding the net interest margin.

First Published:May 10, 2021 11:09 AM IST