Axis Bank Q3 results: Net profit drops 36% , NII rises 14%

 

Axis Bank on Wednesday reported a 36% year-on-year drop in net profit to Rs.1,116.6 crore for the quarter ended 31 December. The private lender reported a net profit of Rs.1,757 crore for the corresponding quarter last year.

"Reported profits after tax for the quarter are adversely impacted to the extent of around Rs.1,050 crore on account of prudent expenses and provisioning charges during the quarter," the bank said.

The bank’s operating profit for the quarter grew 6% year-on-year to Rs.6,096 crore. The core operating profit for the quarter grew 10% year-on-year to Rs.5,754 crores.

The private lender's net interest income, the difference between interest earned and interest, rose 14% year-on-year to Rs.7,372.7 crore. NII in Q3FY20 was at Rs.6,452.98 crore. NII before interest reversals increased 19% YOY to Rs.7,987 crore, the bank said in the filing. Net interest margin (NIM) for Q3FY21 was 3.59% as against 3.57% for Q3FY20. NIM before interest reversals stood at 3.89%, the bank added.

Provisions in the quarter under review increased 32.7% year-on-year to Rs.4,604.28 crore, the bank said in the filing.

In the December quarter, the bank reported gross NPA and net NPA at 3.44% and 0.74% respectively as against 4.18% and 0.98% during the September quarter. The restructured loans as at 31st December, 2020 stood at Rs.2,709 crore that translates to 0.42% of the gross customer assets, the bank said.

Commenting on the bank's performance in Q3, Amitabh Chaudhry, MD&CEO, Axis Bank said, “As the economy turns around, we see fresh enthusiasm and positivity returning to both retail and corporate business. Digital has been one of our biggest strengths and we have fortified it further. With new collaborations with the best brands in their respective fields, we have rolled out some of the most innovative products and services for our customers, with unique features and benefits."

Loan book (including TLTRO investments) grew by 9% year-on-year to Rs.600,835 crore while retail disbursements in Q3FY21 stood at all-time highs, the lender said. Corporate loans (including TLTRO investments) reported 11% year-on-year increase, the lender said.

Axis Bank’s balance sheet improved 15% YOY and to Rs.9,38,049 crore as on 31st December 2020. The total deposits grew by 11% on period end basis and by 8% YOY on quarterly average balance (QAB) basis. On a QAB basis, savings account deposits jumped 14% YOY, retail savings deposits increased 20% YOY, current Account deposits rose 15% YOY and retail term deposits grew 17% YOY. CASA and Retail Term Deposits on QAB basis put together increased 16%YOY, the lender said.

Last week, the Competition Commission of India approved the acquisition of 19.002% stake in Max Life Insurance Company by Axis Bank and its subsidiaries (Axis Capital and Axis Securities), after revised agreements signed by all entities in October last year.