Tamilnad Mercantile Bank reports strong Q3FY25 performance with 6% net profit growth and strategic expansion

TAGS

Limited (TMB) has reported a 6% year-on-year (YoY) increase in net profit, reaching ₹300 crore for the third quarter of FY25. The 103-year-old private sector bank continues to demonstrate resilience with strong fundamentals and a steady loan portfolio expansion, maintaining its track record of consistent profitability.

For the quarter ended December 31, 2024, the bank recorded a 10% increase in operating profit, rising to ₹408 crore, driven by improved margins and disciplined financial management. Total deposits grew 7.68% YoY, crossing ₹50,392 crore, while total advances surged 13.71% YoY to ₹43,650 crore. The bank’s focus on branch network expansion and has positioned it for long-term sustainable growth.

What Factors Drove Tamilnad Mercantile Bank’s Profit Growth?

The bank’s performance in Q3FY25 was primarily fueled by loan portfolio expansion, an increase in non-interest income, and strategic partnerships aimed at enhancing operational efficiency. The net interest income (NII) rose by 6.15% to ₹570 crore, reflecting the bank’s ability to optimize lending margins despite a competitive banking landscape.

Managing Director and CEO Salee S Nair emphasized that Tamilnad Mercantile Bank remains committed to expanding its branch network and leveraging technology to enhance customer experience. “We have achieved 6% YoY growth in net profit, driven by our core lending and deposit businesses. Our strategic initiatives, including partnerships with Oracle, Deloitte, and Bajaj Broking, are helping us improve efficiency and support sustainable growth,” he said.

See also  Avidia Bank partners with Q2 Holdings to revolutionize digital banking experience

Additionally, the bank’s risk management framework has contributed to a significant decline in non-performing assets (NPAs). The gross NPA ratio improved to 1.32% from 1.69%, while net NPA fell to 0.41% from 0.98%, demonstrating disciplined lending practices. The provision coverage ratio (PCR) also strengthened to 69.07%, reflecting a proactive approach to risk mitigation.

How Is Tamilnad Mercantile Bank Expanding Its Market Presence?

To enhance its reach and customer base, Tamilnad Mercantile Bank has been aggressively expanding its branch network, opening five new branches in Q3FY25. With 572 branches and 12 regional offices across 17 states and four Union Territories, the bank continues to strengthen its retail, agricultural, and MSME (RAM) lending portfolio, which now accounts for 92% of total advances.

The bank is also making strategic moves in the digital banking sector, collaborating with technology and consulting giants to optimize its operations. Its recent partnership with Oracle focuses on cloud banking solutions, while the collaboration with Deloitte aims to improve regulatory compliance and process efficiency. Additionally, the tie-up with Bajaj Broking is set to enhance customer investment options and financial services offerings.

See also  LIC reports record profit after tax of Rs 17,469cr in H1-FY 2024

What New Initiatives Have Been Launched by Tamilnad Mercantile Bank?

As part of its growth strategy, the bank has introduced three key divisions to improve customer service and risk management:

  • Global NRI Center: A dedicated unit catering to Non-Resident Indians, providing seamless banking solutions for their financial needs.
  • Transaction Banking Group: Focused on increasing current account deposits, sourcing government business accounts, and offering customized transaction banking services.
  • Credit Management Center: A specialized division designed to enhance credit risk assessment and streamline loan processing for better efficiency.

These initiatives align with Tamilnad Mercantile Bank’s broader mission to strengthen its financial infrastructure while ensuring a seamless banking experience for its expanding customer base.

How Strong Is Tamilnad Mercantile Bank’s Financial Position?

Tamilnad Mercantile Bank continues to exhibit strong financial stability, with its Capital to Risk-Weighted Assets Ratio (CRAR) improving to 29.35% from 25.95%, reinforcing the bank’s ability to absorb economic shocks. The book value per share increased by 13.66% to ₹550.38, reflecting solid .

See also  Transindia Real Estate Limited divests logistics park for Rs 636.71cr

Additionally, the bank’s net worth grew by 13.65% YoY, reaching ₹8,715 crore, driven by consistent profitability and prudent capital management. The bank’s earnings per share (EPS) rose to ₹18.96, up 5.63% from ₹17.95 in the previous year.

What’s Next for Tamilnad Mercantile Bank?

Looking ahead, Tamilnad Mercantile Bank aims to further expand its footprint in high-growth markets while strengthening its digital capabilities. The bank remains focused on responsible lending practices, improving customer service, and diversifying its revenue streams to ensure long-term profitability.

With a well-diversified business model, a growing branch network, and robust risk management frameworks, Tamilnad Mercantile Bank is well-positioned to capitalize on emerging opportunities in ‘s financial sector. The bank’s continued emphasis on technology adoption, digital transformation, and customer-centric banking solutions will be key drivers of growth in the coming quarters.


Discover more from Business-News-Today.com

Subscribe to get the latest posts sent to your email.

CATEGORIES
TAGS
Share This