Higher provisioning seems to be the norm this quarter; at least that is what we have seen in few bank results that have come out. Kotak Mahindra too has made higher provisioning for Q3 but its earnings were as per what most analysts had estimated. Its net profit for the quarter rose 11% (QoQ) at Rs.635 crore and this was thanks to the healthy 5% growth in NII at Rs.1766 crore while NIM was status quo at 4.3%. Non interest income is what gave its bottomline the boost – it was up over 17% at Rs.722 crore.

Provision is what dented the growth of net profit – it was at Rs.235 crore, up 33% QoQ and 8 times YoY. This increase in provisions was on account of MTM investments, including Rs.148 crore provided towards loans. Advances rose 3% to Rs.1.15 lakh crore while deposits were up 6% at Rs.1.3 lakh crore.

Asset quality was stable sequentially at 2.3% while Net NPA fell from 1.05% to 0.96%. Restructured loans stood at Rs.346 crore. The Bank clarified that there was no corporate debt restructuring participation, no sale of loans to asset reconstruction companies, no conversion to off-balance sheet and no loan transfer to 5/25 scheme. Currently, Kotak has 1,298 branches and 1,987 ATMs.