J&K Bank Q2 FY24 profit soars 56.5% to Rs 381cr: Yearly breakdown revealed

Jammu and Kashmir Bank Limited (J&K Bank) announced a robust 56.5% Year-on-Year (YoY) profit growth, reaching Rs 381.07 Cr in the September Quarter (Q2) of the current financial year (CFY). This growth is significantly higher compared to the Rs 243.49 Cr reported in the same quarter of the previous year. Additionally, the bank’s half-year (H1) net profit witnessed a 73% surge, clocking in at Rs 707.52 Cr.

Net Interest Income and Other Financial Metrics

The Bank’s Net Interest Income (NII) reported an 11% YoY growth for the September quarter, settling at Rs 1333.83 Cr. Furthermore, this NII saw an impressive 17% increase for H1, reaching Rs 2617.13 Cr. Other financial highlights for the bank include a rise in the operating profit by 23% YoY for the reviewed half-year of CFY. Interestingly, the bank’s NIM improved slightly to 4.07%, and the Return on Assets saw a significant boost, reaching 1.08%.

Comments from the CEO on Bank’s Performance

MD & CEO Baldev Prakash remarked on the bank’s notable growth, emphasizing the consistent progress and adherence to annual guidance numbers. “With a NIM maintained at over 4% and our asset quality vastly improved during the last two years, I feel confident to say that by the end of the current fiscal, we will achieve the envisaged targets,” he stated.

Asset Quality Improvements

The bank’s dedication to enhancing asset quality is evident with the Gross NPA Ratio decreasing to 5.26% from 7.67% YoY. In parallel, the Net NPA ratio moderated to 1.04% from the previous 1.39%. There was also a notable improvement in the Provision Coverage Ratio (PCR) by 441 basis-points to 89.99%.

Business Growth and Future Plans

The deposits and advances of the bank expanded YoY by 9% and 18%, respectively. Additionally, the bank’s Yield on Advances surged to 9.50%. While acknowledging a dip in the CASA figure in line with industry trends, MD & CEO Prakash highlighted initiatives to mobilize deposits using cutting-edge technology and innovative strategies.

Capital Position and Digital Transformation

Ensuring a cushioned capital position, the bank reported a Capital Adequacy Ratio of 14.53%, up from 12.86% last year. Furthermore, the MD & CEO emphasized the prioritization of digital transformation, mentioning the roll-out of innovative digital solutions aiming to enhance client convenience and safety.

By focusing on digital initiatives and maintaining a steady growth trajectory, J&K Bank seems poised to achieve its envisioned goals by the end of CFY, setting the stage for further success in the upcoming financial periods.