SRINAGAR: Inching closer to turnaround in its bottom-line J&K Bank today reported a gross operating profit of Rs 368 Cr and Net profit of Rs 30 Cr for the quarter ended June 2017, a spokesman of the bank said.

The reviewed results were declared by the Bank today after the Board of the Bank adopted the numbers in its meeting held here at the bank’s Corporate Headquarters. Notably, the Bank had issued a guidance for 2017-18 being the turnaround year after reporting a loss of Rs 1632 Cr during the last financial year.

“We are on a journey to reinvent ourselves as stronger and valued Bank with our strategy of strengthening balance sheet by adopting highest standards of transparency. Understanding fully well the importance of providing growth capital to our entrepreneurs in the state there has been no letup in our focus on credit expansion within the state while as we continue to follow a conservative approach to balance sheet expansion by lending to only the “A” rated Corporates in the rest of India”, said JK Bank Chairman and CEO Parvez Ahmed post declaration of results.

Commenting on the numbers Chairman said, “The interest income on loans & advances earned by the Bank for the quarter has grown to Rs 1207 Cr as on June 30, 2017 by recording a sequential QoQ growth of 5 pc and expenditure of the Bank has been brought down by 7 pc through better liability management and cost rationalization.  The CASA ratio of the Bank is at healthy 51 pc riding on a growth of 24 pc YoY with Bank retaining most of the deposits mobilized during demonetization contrary to the industry trend of downward movement in such deposits.”

“After a sluggish period of Credit growth in J&K state over the previous FY, in the Q1 of current fiscal we have recorded a growth of almost 4 pc QoQ with signs of all round pick up in retail credit across all the business zones of the bank in the state. The foregoing elements have catalyzed improvement of our Net Interest Income (NIM), the benchmark of profitability, by 32 bps to 3.70 pc YoY”, he said.

The Chairman also asserted that as part of robust NPA management, the Bank significantly improved its Provision Coverage Ratio (PCR) to 70 pc by making provisions ofRs 471 Cr during the current quarter. “We have still preferred building of more provisions than showing higher profits,” said the chairman.

Notably, the bank has shown improvement in its Net NPA ratio to 4.65 pc.  While as Gross NPA stood at 10. 79% at the end of quarter ended June 2017.

As recovery of bad loans remains the topmost priority, the Bank recovered around Rs 200 Cr during the current quarter which is in addition to the Rs 350 Cr recovered by the bank during the fourth quarter of the last financial year.

Furthermore, he added, “The Bank is on course to reorient its business strategy based on changed business dynamics and growing digital ecosystem post Demonetization drive of the Government.”

Going forward, he said, the upgradation and leveraging of technology for business coupled with efficient business processes is going to be the hallmark of turnaround strategy for the Bank.

Meanwhile, the Bank reported a total business of Rs 120477 Cr with deposits of Rs 71744 and Advances ofRs 48733 Cr as on June 30, 2017. The Bank has shown a marked reduction in cost of deposits from 6 pc a year ago to 5.27 pc as of June, 2017. The Capital Adequacy Ratio of the Bank improved by 30 bps to 11.10 pc from 10.80 pc as on March 2017 which indicates better financial strength.

Pertinently, the Bank has recently expanded its board with directors having expertise in diverse fields of Corporate Functioning, Risk Management, Information Technology, Communication and Corporate Law to strengthen the governance framework.


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