Axis Bank continues better-than-expected performance and has posted and increase in its net profit for the sixth quarter in a row. The bank has posted a net profit of 63 per cent at Rs 501 crore for the quarter ended December 31, 2009. Its net profit was Rs 307 crore in the same period last year.

The Chairman and CEO of Axis Bank, Dr. Nayak said, "The NIM and cost of fund will re-equilibrate this quarter with interest rates going down." He said that growth in asset size and strong fee income helped to increase net for Q3.

Cost of funds increases 6.91 per cent while Net Interest Margin fell to 3.12 per cent for the third quarter despite high interest rates and liquidity crunch. The bank is expecting Net Interest Margin in the range of 3.25- 3.5 per cent for the current financial year.

Bank's trading income increased to Rs 114 crore, 35 per cent above as compared to same quarter last year. However, the shares of current account and savings accounts declined to 38 per cent of total deposits.

A Mumbai-based banking analyst said, "The bank has seen a healthy growth in advances portfolio. This is at a time when some of its peers are clearly seeing a slowdown in credit pick-up and are consciously scaling down growth.''

Shares of Axis bank declined 6.97 per cent and closed at Rs 485.75 on the BSE on Friday.