Kotak Mahindra Bank reported a 13% increase in profit for the second quarter of FY25, reaching ₹5,044 crore.

October 19, 2024  Mumbai, Maharashtra : Kotak Mahindra Bank announced its financial results for the second quarter of the fiscal year 2024-25, reporting a consolidated profit after tax (PAT) of ₹5,044 crore. This marks a substantial 13% increase from ₹4,461 crore in the same period last year.

The results were approved during the Board of Directors meeting held today in Mumbai. The bank's standalone PAT for Q2FY25 was ₹3,344 crore, reflecting a 5% growth compared to ₹3,191 crore in Q2FY24.

During the quarter, the bank's Net Interest Income (NII) rose by 11% year-on-year to ₹7,020 crore, while the Net Interest Margin (NIM) was sustained at 4.91%. Operating profit for the quarter reached ₹5,099 crore, indicating an 11% increase from the previous year, highlighting the bank's continued growth in its core banking operations.

Kotak Mahindra Bank's subsidiaries also reported strong performances, significantly contributing to the consolidated PAT. Kotak Securities reported a PAT of ₹444 crore, a 37% increase from Q2FY24, while Kotak Mahindra Life Insurance posted a PAT of ₹360 crore, up 46% year-on-year. Kotak Mahindra Prime recorded a PAT of ₹269 crore, reflecting a 29% year-on-year growth, showcasing the bank's diversified financial services portfolio.

As of September 30, 2024, the bank's customer base grew to 5.2 crore, an increase from 4.6 crore in the previous year. Customer assets, including advances and credit substitutes, expanded by 18% year-on-year to ₹450,064 crore, demonstrating robust growth in lending activities.

The asset quality improved, with the Gross Non-Performing Assets (GNPA) ratio declining to 1.49% from 1.72% in the prior year, while the Net NPA stood at 0.43%. The bank's deposit base also saw significant growth, with average total deposits rising by 16% year-on-year to ₹446,110 crore. Average term deposits grew by 26% year-on-year to ₹259,434 crore, while the Current Account and Savings Account (CASA) ratio remained healthy at 43.6%. The capital adequacy ratio, according to Basel III norms, was strong at 22.6%, with a Common Equity Tier 1 (CET1) ratio of 21.7%.

For Q2FY25, the consolidated financial performance recorded an annualized Return on Assets (ROA) of 2.53%, slightly down from 2.68% in the same period last year, and an annualized Return on Equity (ROE) of 13.88%, compared to 14.99% in Q2FY24. Total assets under management surged by 37% year-on-year to ₹680,838 crore, driven by an impressive 60% growth in Kotak Asset Management's domestic equity AUM, which reached ₹319,161 crore as of September 30, 2024.

Strategic achievements during the quarter included gains from the divestment of Kotak General Insurance (KGI), contributing to an increase in net worth, which now stands at ₹147,214 crore. Additionally, regulatory adjustments from the Reserve Bank of India regarding investment valuation added ₹4,777 crore to the bank's reserves.