The operating profit stood at Rs 39.18 crore (Rs 52.09 crore).

The prime reason for the fall in profitability was the decline in profit on sale of investments, which fell from Rs 33.25 crore last year to Rs 12.84 crore this year, said A. Sethumadhavan, chairman.

"However, it is worth mentioning that despite this and the steep increase in the yield on Government securities during the quarter, necessitating adequate provisions, the bank could achieve reasonable profits on its operations," he added.

The interest income increased to Rs 180.19 crore (Rs 160.78 crore), interest expenditure showed marginal growth to touch Rs 120.42 crore (Rs 117.02 crore).

Net interest margin showed a healthy growth from 2.30 per cent to 2.66 per cent.

The book value of the share grew from Rs 95.77 to Rs 115.46. Business per employee also grew from Rs 2.94 crore to Rs 3.43 crore.

The bank''s net worth also increased from Rs 343.58 crore to Rs 413.33 crore.

It was able to record a capital adequacy level of 12.09 per cent, while the RBI-stipulated level is nine per cent.

While the gross NPAs could be reduced from 10.05 per cent to 7.51 per cent, the net NPAs were pruned from 6.20 per cent to 4.53 per cent, a bank release said.

On the business front, the bank was able to notch a growth of 18.3 per cent to Rs 12,055 crore (Rs 10,194 crore).

Deposits grew by 15.4 per cent to touch Rs 7,787 crore (Rs 6,750 crore), while advances rose by 23.9 per cent to Rs 4,268 crore (Rs 3,444 crore). Investments grew by 6.8 per cent to Rs 3,541 crore (Rs 3,314 crore).

The bank opened its 411th branch at Gurgaon during the quarter and proposes to open 19 more branches during the year, taking the total number to 430.