InvestorQ : What explains the strong performance of CSB Bank in the Dec-20 quarter?
swati Bakhda made post

What explains the strong performance of CSB Bank in the Dec-20 quarter?

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Sam Eswaran answered.
4 months ago
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CSB Bank reported stellar growth in net profit up 88.5% at Rs.53.05 crore for the Dec-20 quarter. It also reported 36.41% revenue growth at Rs.599.24 crore for the period helped by doubling of treasury income and growth in interest earned from retail lending. However, corporate banking was tepid. Operating profits were up 160.48% at Rs.182.36 crore.

The sharp growth in net interest margins or NIM and spike in investment income led to the OPM nearly doubling from 15.94% 30.43%. The PAT for the Dec-20 quarter was up 88.52% at Rs.53.05 crore notwithstanding a 4-fold increase in asset provisions to Rs.111 crore. PAT margins improved from 6.41% in Dec-19 quarter to 8.85% in Dec-20 quarter.

The growth traction for CSB Bank was led by treasury income and retail banking. The net profit is actually down on a sequential basis due to higher provisions made. However, gross NPAs at 3.04%, net NPAs at 0.68%, capital adequacy ratio at 21% and the return on assets or ROA at 0.96% are all much better than industry averages.

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