Sidbi posts 34 pct increase in net profit to Rs 540 cr in Dec quarter

Development financial institution Sidbi Wednesday reported a 34 per cent jump in net profit at Rs 540.33 crore for the quarter to December, helped by higher interest income. Net interest income rose 40.3 per cent to Rs 725.59 crore as against Rs 517.15 crore in the same period last year, the lender said.

However, net interest margin went down by 64 basis points to 1.86 per cent due to the focus on low-risk assets and the increased cost of funding, Sidbi said in a statement. "Credit demand to the MSEs sector continues to be strong. We expect to maintain the growth momentum as we continue to move forward," chairman and managing director Mohammad Mustafa, said.

For the nine-month period to December, profit jumped 40 per cent to Rs 1,432.85 crore on a 20.8 per cent rise in net interest income to Rs 1,857.92 crore. The cost to income ratio improved by 216 basis points to 16.8 during the nine months from 18.9 a year ago.

The gross non-performing assets ratio came down by 36 basis points to 0.73 and the net NPA ratio declined by 26 basis points to 0.23, the company said. Provision coverage ratio stood at 86 per cent, an increase of 400 basis points from the December 2017 level.