IDFC FIRST Bank reports highest-ever profit in FY23

IDFC FIRST Bank has announced its audited financial results for the quarter and financial year that ended on March 31, 2023. During the financial year, the bank recorded a net profit of Rs. 2,437 crore, as compared to Rs. 145 crore in the previous year. The bank's quarterly net profit grew 134 per cent YoY, from Rs. 343 crore in Q4-FY22 to Rs. 803 crore in Q4-FY23. The strong growth in core operating income was the major driving force behind this increase.

“We have registered our highest ever quarterly profit of Rs. 803 crores in Q4 FY 23 and highest ever yearly profit of Rs. 2,437 crores in FY23,” Managing Director and CEO V Vaidyanathan said.

The bank had trading gains of Rs. 216 crore in Q4-FY23, and it utilized Rs. 79 crore to increase the provision coverage ratio. The net profit of the bank would have been Rs. 701 crore for Q4-FY23, if adjusted for these one-time items. The Core ROE on this basis would have been 12.3 per cent, which increased from 6.67 per cent for Q4-FY22.

The net interest income (NII) for the year grew 30 per cent YoY, from Rs. 9,706 crore in FY22 to Rs. 12,635 crore in FY23. The fee and other income for the year grew by 54 per cent YoY, from Rs. 2,691 crore in FY22 to Rs. 4,142 crore in FY23. Retail fees constituted 91 per cent of the overall fees for the quarter Q4-FY23.

The provisions for the year decreased by 46 per cent YoY, from Rs. 3,109 crore in FY22 to Rs. 1,665 crore in FY23. Credit cost for FY23 was 1.16 per cent against the guidance of 1.5 per cent. The bank's ROA improved from 0.08 per cent in FY22 to 1.13 per cent in FY23, while ROE for FY23 improved to 10.95 per cent from 0.75 per cent in FY22.

On the retail side, the Gross NPA is 1.65 per cent and the net NPA is at 0.55 per cent, against the guidance of Gross NPA of 2.0 per cent and NNPA of less than 1 per cent. Vaidyanathan stated that the asset quality remains high. If the infrastructure financing book, which is already in run-down mode, is excluded, the Gross NPA and Net NPA would be 1.84 per cent and 0.46 per cent, respectively, at the overall bank level.