South Indian Bank's PAT shrinks by 48.45 per cent on YoY basis

South Indian Bank (SIBL) recently posted its June quarter result. The bank's standalone total income increased by 2.5 per cent to Rs 1481 crore in Q1FY16 on a sequential basis. Its total expenditure declined by 22.41 per cent to Rs 343 crore in Q1FY16 as compared to the previous quarter. SIBL's total expenditure decreased predominantly due to a 42.28 per cent reduction in the provisions and contingencies expense. There has been a 20.44 per cent reduction in employee expense in June 2015 quarter.

EBIT of SIBL received a boost by 13.48 per cent to reach Rs 1138 crore in Q1FY16 on sequential basis. The bank's PBT too increased by 272.17 per cent from Rs 27.24 crore in Q4FY15 to Rs 101.38 crore in Q1FY16 though its interest expense increased by 6.25 per cent to Rs 1036 crore during the quarter. Its PAT rose by 300.06 per cent to Rs 65.29 crore in Q1FY16 on sequential basis. SIBL's PAT margin expanded by 328 basis points to 4.41 per cent in Q1FY16 compared to previous quarter. The bank's net interest margin (NIM) declined by 16 basis points to 2.53 per cent in Q1FY16 on sequential basis due to higher slippages and had about 43 per cent low yielding corporate loan portfolio.

The asset quality of SIBL declined and gross NPA (Non performing Assets) stood at 1.85 per cent to Rs 713.83 crore in Q1FY16 against 1.71 per cent amounting to Rs 643.45 crore in Q4FY15. Its net NPA expanded by 25 basis points to 1.21 per cent amounting to Rs 463.98 crore in Q1FY16 on sequential basis.

Considering the segment results, SIBL earned a total income of 45.58 per cent amounting to Rs 675 crore from corporate banking segment, 31.12 per cent from amounting to Rs 461 crore retail banking segment, 21.41 per cent amounting to Rs 317 crore from treasury segment, and remaining 1.9 per cent amounting to Rs 28 crore from banking operations in Q1FY16.

On yearly basis, total income of SIBL increased by 1 per cent to Rs 1481 crore in Q1FY16. . The bank's EBIT increased by 0.67 per cent to Rs 1138 crore in Q1FY16 as compared to the same period of the previous financial year. Its PBT declined by 40.26 per cent to Rs 101.38 crore in Q1FY16 on yearly basis because the interest expense for the company increased by 3.24 per cent to Rs 1036 crore during the quarter. SIBL's PAT decreased by 48.45 per cent from Rs 126.65 crore in Q1FY15 to Rs 65.29 crore in Q1FY16. PAT margin contracted by 423 basis points to 4.41 per cent in Q1FY16 on yearly basis.

SIBL provides personal banking, NRI banking and Business banking services. The Bank operates in four segments such as Treasury services, Corporate or Wholesale Banking, Retail Banking, Other Banking operations. SIBL has total of 828 branches with 1248 ATM machines installed across India.