Bank of Maharashtra (BoM), a state-owned lender based in Pune, has posted a remarkable 36% year-on-year increase in its net profit for the third quarter of FY2024-25. The bank earned a net profit of Rs 1,406 crore for the October-December 2024 period, compared to Rs 1,036 crore in the same quarter last year. This strong growth was driven by higher interest income and improved asset quality.
Surge In Total Income
The bank’s total income for Q3 FY2024-25 reached Rs 7,112 crore, a significant rise from Rs 5,851 crore recorded in Q3 of the previous fiscal year. The increase was primarily attributed to a sharp boost in interest income.
Bank of Maharashtra reported an interest income of Rs 6,325 crore for the quarter under review. This is an increase from Rs 5,171 crore in the corresponding period of the previous year. The growth in interest income reflects the bank’s effective management and rising lending rates.
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Improved Asset Quality
The bank’s asset quality showed significant improvement in the third quarter. The gross Non-Performing Assets (NPAs) reduced to 1.80% of the gross loans, down from 2.04% in the same period last year. Similarly, net NPAs also saw a decrease, falling to 0.2% from 0.22% at the end of Q3 FY2023-24. This reduction in bad loans highlights the bank’s prudent risk management practices.
The Provision Coverage Ratio (PCR) as of December 31, 2024, stood at an impressive 98.28%. This indicates that the bank has a high level of provisions set aside to cover potential loan losses, further strengthening its financial position.
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Capital Raising Efforts
In October 2024, Bank of Maharashtra raised Rs 3,500 crore through a Qualified Institutional Placement (QIP). The bank issued 61,01,81,311 equity shares, priced at a premium of Rs 47.36 per share, resulting in a reduction of the Government of India’s shareholding in the bank to 79.60% by the end of December 2024.
Nine-Month Profit Growth
For the nine-month period ended December 31, 2024, Bank of Maharashtra reported a net profit of Rs 4,027 crore, a notable rise from Rs 2,837 crore in the same period last year. The total income for the nine months also increased to Rs 20,872 crore from Rs 16,938 crore in the corresponding period of FY2023-24.
With its solid financial performance in Q3 and the reduction in NPAs. Bank of Maharashtra is on a strong growth trajectory. The rise in interest income and robust provision coverage indicate that the bank is well-positioned to handle future challenges. The successful capital raising through the QIP has also enhanced the bank’s financial flexibility, allowing it to pursue growth opportunities in the coming quarters.
In conclusion, Bank of Maharashtra’s impressive Q3 results reflect its commitment to improving profitability, managing assets effectively, and bolstering capital. The bank is on track for sustained growth and stability in the current financial year.
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