A 52% (YoY) rise in other income at Rs.163 crore,  a 11% jump in operating income at Rs.425 crore and 13% increase in NII at Rs.882 crore, helped J&K Bank close Q3FY19 with a 43% rise in net profit at Rs.104 crore.

Though profitability was good, there was disappointment on the asset quality front, which saw Gross NPA coming in higher at 9.94% v/s 9% (QoQ0 and Net NPA too rose from 3.91% to 4.69%.

The NPA coverage ratio though static on a YOY basis and still comparable with the best in the industry, has seen a dip on sequential basis to 65.82 % mainly on account of downgrade of the IL&FS which reflects that the bank has been able to tide over the IL&FS shock without any major deterioration in the balance sheet parameters.

The Bank is undertaking an aggressive transformation program to be implemented by FY20 and post this, it is envisaging a total business of Rs.2.45 lakh crore with a targeted profit of Rs,.2000 crore,  NIIM ranging between 3.5-4%, ROA of 1.3%, ROE of 16% and credit cost below 1% at the end of FY 2022.

The stock market has decided to ignore the asset quality deterioration and concentrate on the future, which is why the stock figures among the top five gainers on the BSE today. Recording a volume of over 5 times, the stock price rose 6.6% to Rs.38.70.