Syndicate Bank has reported a 19% drop in its net profit for the March 2010 quarter. With this it is seen that the bank has faced a decline in profits for three consecutive quarters.

This quarter proved to have generated the lowest profit of Rs. 168 crore in the last seven quarters.

The major reason for such a condition is the inability of the bank to generate business at high rates. The loan book of the bank has grown by only 11 % when the industry growth stood at 17%.

The bank is also trying to improve its asset quality which has also taken a worse trend. The gross NPA of the bank has amounted to 2.6% of its total advances as on September 2009. Since then the bank has been able to bring down its NPA level to 2.2% as on March 2010.

The bank is also making efforts to improve its share of current and saving account (CASA) deposits. CASA deposits accounted to 32.9% of the total deposits of the bank as on March 2010.

At current levels, the credit-to-deposit ratio of the bank is 78%, which is one of the highest in the industry.

So the bank has to succeed in two parameters. One is the improvement in its asset quality and the other is the growth in its deposits.