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NPA Decline Boosts Profits for Three Banks as Petrol and Diesel Prices Hold Steady

Canara Bank, Indian Bank, and Indian Overseas Bank see significant profit increases amidst reduced NPA, while UCO Bank faces a 23% decline

In the third quarter of the current financial year, the net profit of three public sector banks experienced notable growth, attributed to a substantial reduction in Non-Performing Assets (NPA). Interestingly, the key contributing factor appears to be the sustained stability in petrol and diesel prices over the past two years. Here’s a closer look at how Canara Bank, Indian Bank, and Indian Overseas Bank capitalized on this unique scenario, while UCO Bank faced a 23% decline in profits.

Canara Bank: 29% Surge in Net Profit

Canara Bank reported a commendable 29% increase in net profit, soaring to Rs 3,656 crore in the third quarter. The total income witnessed a rise from Rs 26,218 crore to Rs 32,334 crore, with net interest income growing by 9.5% to Rs 9,417 crore. A crucial highlight was the reduction in Gross NPA from 5.89% to 4.39%.

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Indian Bank: 52% Profit Surge

Indian Bank demonstrated a robust financial performance, with a remarkable 52% surge in net profit, reaching Rs 2,119 crore. The total income also saw a substantial increase from Rs 13,551 crore to Rs 16,099 crore. Similar to Canara Bank, Indian Bank experienced a significant drop in Gross NPA, from 6.53% to 4.47%.

Indian Overseas Bank (IOB): 30% Rise in Net Profit

Indian Overseas Bank celebrated a 30% increase in net profit, amounting to Rs 723 crore. The interest income reached Rs 6,176 crore, and there was a noteworthy decline in Gross NPA from 8.19% to 3.90%.

UCO Bank: 23% Decline in Net Profit

Contrary to its counterparts, UCO Bank faced a 23% decline in net profit, settling at Rs 503 crore. Despite this, the total income increased from Rs 5,451 crore to Rs 6,413 crore. Notably, Gross NPA reduced from 5.63% to 3.85%.

Indian Oil Corporation (IOC): Profit Soars to Rs 8,063 crore

In a related development, Indian Oil Corporation (IOC) posted an impressive profit of Rs 8,063 crore, a significant leap from Rs 448 crore in the corresponding quarter a year ago. The primary driver behind this surge was the unchanging prices of petrol and diesel over the last two years, leading to improved profit margins amid a backdrop of economical crude oil prices.

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This unique economic landscape, where the banking sector benefitted from reduced NPAs amid stable fuel prices, underscores the intricate interplay between different sectors in shaping financial outcomes.

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