ICICI Direct: J&K Bank Posts Weak Q1 Performance; Subdued RoA To Impact Valuation
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ICICI Direct Report
The Jammu and Kashmir Bank Ltd. reported a weak set of numbers wherein muted topline coupled with higher provision and tax dented earnings.
On the back of muted advances and margins, net interest income growth was flattish at Rs 904 crore versus Rs 902 crore in Q1 FY20.
Net interest margins were down approximately 34 basis points YoY to 3.56% on account of lower yields.
Other income was down 35% YoY to Rs 120 crore, due to sluggish fee income growth.
Decline in other income was partially offset by stable opex, thus leading to 20% YoY decline in operating profit to Rs 331 crore.
Higher provision and tax outgo marred profit after tax at Rs 6.5 crore, down 70% YoY.
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