Indian Bank Q2 results: Net profit jumps 2.6x

State-owned Indian Bank has reported a 2.6-fold rise in net profit for the September quarter buoyed by earnings from treasury operation and bad loan recovery while it logged lower interest income and higher provisions. The net profit for the quarter was at Rs 1089 crore as against Rs 412 crore in the year-ago period.

Its quarterly net interest margin (NIM) from domestic operation fell to 2.89 per cent from 3.06 per cent in the same period last year. Net interest income declined by 1 per cent at Rs 4084 crore as compared with Rs 4144 crore over the same period.

The bank’s managing director Shanti Lal Jain, who took charge on September 1, exuded confidence that interest income would rise with higher credit offtake which is expected going forward with the economic recovery.

Its operating profit rose 11 per cent at Rs 3276 crore as against Rs 2942 crore, riding on 26 per cent higher non-interest income at Rs 1966 crore as against Rs 1558 crore in the year-ago period. Non-interest income was buoyed by recovery of bad debts as well as higher forex income, Jain said.

The lender made a total recovery of Rs 3426 crore including upgradation of accounts as compared with Rs 1168 crore earlier. Provisions & contingencies for the second quarter ending September 30 were at Rs 2187 crore, 13.6 per cent lower compared with Rs 2530 crore earlier.

The bank’s gross non-performing assets ratio improved to 9.56 per cent at the end of the quarter from 9.89 per cent a year back. Net NPA however rose to 3.26 per cent as against 2.96 per cent over the same period.

It has seen fresh slippages of Rs 3952 crore with the classification of Srei Group’s account as NPA contributing Rs 1828 crore to it. "The slippage is due to one NBFC group account. We are not overly concerned over asset quality in the future," Jain said.

Its advances grew by 5 per cent to Rs 3.86 lakh crore, primarily driven by growth in retail, agriculture and MSME lending. Loans to these sectors constitute 60 per cent of the bank’s total advances.

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Uco Bank Q2 results: Profit surges 7-fold

 

State-owned Uco Bank reported a near seven-fold jump in net profit for the September quarter, riding on higher interest income and write-back of provisions made earlier.

Its net profit stood at Rs 205.4 crore as against Rs 30.1 crore in the year-ago period.

Net interest income (NIM), a key parameter of profitability, remained flat at 2.79% for the quarter under review, despite lower lending rates.

"We expect NIM to be at 3% or more in the near future," managing director AK Goel said. He said the lower cost of funds, better collection efficiency from stressed accounts as well as higher credit growth would help in the improvement of NIM.

We expect advances to grow around 10% for the full year, Goel added.

The Kolkata-based lender's operating profit rose 24% at Rs Rs 1,334 crore as compared with Rs 1,076 crore in the year-ago quarter. Net interest income rose about 15% at Rs 1,598 crore from Rs 1,393 crore over the same period last year. Other income grew 31.2% YoY to Rs 936 crore.

Goel said the bank made an additional provision of Rs 250 crore towards Covid-19 related risk on asset quality, taking the total additional Covid-related provision to Rs 750 crore. Total bad loan provisions rose to Rs 1,595 crore in the September quarter from Rs 1,032 crore in the year-ago period.

The bank's total provision, however, came down to Rs 1,019 crore during the period from Rs 1,301 crore on account of write-backs of provisions made earlier. The bank has recovered Rs 550 crore from written-off accounts, taking the total recovery and upgradation to Rs 1,876 crore during the quarter.

Uco's asset quality improved with the gross non-performing assets (NPA) ratio falling to 8.98% at the end of September from 11.62% a year back. Net NPA stood at 3.37%, down from 3.63%. Its provision coverage ratio rose to 90% from 89.82% over the same period.

Its total advances grew 5.7% to Rs 1.22 lakh crore with retail, agriculture and MSME sectors now contributing about 64% to it.

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Axis Bank Q2 results: Lender posts highest ever quarterly profit, up 86% YoY

Axis Bank on Tuesday reported an 86 per cent year-on-year (YoY) rise in net profit at Rs 3,133 crore for the September quarter compared with Rs 1,683 crore in the same quarter last year. This was the highest ever quarterly profit for the bank, the lender said in a BSE filing.

Net interest income (NII) for the bank rose 8 per cent YoY to Rs 7,900 crore compared with Rs 7,326 crore in the year-ago quarter. Net interest margin (NIM) for the recently concluded quarter came in at 3.39 per cent.

Specific loan loss provisions for the September quarter stood at Rs 927 crore compared with Rs 2,865 crore in the June quarter and Rs 724 crore in the year-ago quarter. Total Provisions & contingencies for the quarter fell to Rs 1,735 crore from Rs 3,302 crore in the preceding quarter and Rs 4,343 crore in the corresponding quarter last fiscal.

Gross NPA ratio fell to the lowest level in 20 quarters to 3.53 per cent for the July-September period. The figure stood at 3.85 per cent in the June quarter and 4.28 per cent in the year-ago quarter.

Gross slippages for the said quarter came in at Rs 5,464 crore, lower than Rs 6,518 crore in the June 2021 quarter but higher than Rs 1,751 crore (as per IRAC norms) in the same quarter last year.

"Slippages in Q2FY21 moderated due to regulatory forbearances that do not exist in the current quarter. Recoveries and upgrades from NPAs during the quarter were Rs 4,757 crore while write-offs were Rs 2,508 crore. Consequently, there were net slippages in NPAs (before write-offs) for the quarter of Rs 707 crore compared to Rs 3,976 crore in Q1FY22. Net slippages in NPAs (before write-offs) for retail loans stood at Rs 697 crore, and for SME there was a Rs 16 crore decrease in NPAs (before write-offs)," the bank said.

Fee income for the quarter rose 17 per cent YoY to Rs 3,231 crore. Retail fees jumped 19 per cent YoY and

constituted 63 per cent of the bank’s total fee income. The corporate & commercial banking fee grew 15 per cent, the bank said.

"The trading profits and miscellaneous income for the quarter stood at Rs 473 crore and Rs 95 crore, respectively. Overall, the non-interest income (comprising of fee, trading profit and miscellaneous income) for Q2FY22 stood at Rs 3,798 crore, up 6 per cent YoY," the bank said.

The bank’s provision coverage, as a proportion of Gross NPAs, stood at 70 per cent against 77 per cent as of September 2020 and 70 per cent as of June 30. Provisions prior to technical write-offs remained stable at 88 per cent.

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IndusInd Bank Q2 results: Profit jumps 72% YoY

Private sector lender IndusInd Bank on Wednesday reported a 73 per cent rise in its consolidated net profit to Rs.1,146.73 crore for the second quarter ended September 30. It had posted a net profit of Rs.663.08 crore in the year-ago period.

Total income during the July-September quarter rose to Rs.9,488.06 crore from Rs.8,731.52 crore a year ago, IndusInd Bank said in a regulatory filing.

Interest income moved up at Rs.7,650.36 crore from Rs.7,177.21 crore.

On a standalone basis, the net profit increased by 72% to Rs.1,113.53 crore from Rs.647.04 crore. And the total income rose to Rs.9,487.56 crore against Rs.8,731.05 crore.

Bank's provisions for bad loans and contingencies fell to Rs.1,703.36 crore for the quarter from Rs.1,964.44 crore reserved for the year-ago period.

However, there was an uptick in the bank's gross bad loan proportion at 2.77 per cent of gross advances as of September 30, 2021, against 2.21 per cent a year earlier.

Net NPAs too increased to 0.80 per cent from 0.52 per cent.

The annualised return on asset (RoA) stood at 1.26 per cent compared with 1.12 per cent in the preceding quarter of this fiscal and 0.83 per cent in the same quarter last fiscal.

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Kotak Mahindra Bank Q2 Results: Standalone profit falls 7%

Private sector lender Kotak Mahindra Bank on October 26 reported a 7 percent year-on-year decline in standalone profit at Rs 2,032 crore for the September 2021 quarter due to higher provisions. But supported by higher other income, the profit was ahead of analysts' estimates. However, net income sequentially grew by 24 percent on sharp decline in bad loan provisions.

Standalone net interest income in Q2FY22 rose 3.2 percent year-on-year to Rs 4,020.6 crore - meeting street expectations - with healthy 15 percent YoY (8 percent QoQ) loan growth. Net interest margin contracted 5 bps year-on-year and 15 bps sequentially to 4.45 percent in Q2.

"Advances during the quarter increased by 14.7 percent to Rs 2,34,965 crore, and deposits grew by 11.5 percent to Rs 2,91,711 crore compared to year-ago period," said the bank in its BSE filing on Tuesday.

Profit was estimated at Rs 1,792.2 crore and net interest income was expected at Rs 4,008.1 crore for the quarter, according to average of estimates of analysts polled by CNBC-TV18.

Asset quality improved during the quarter ended September 2021 with gross non-performing assets as a percentage of gross advances falling 40 bps QoQ to 3.2 percent and the net NPA declined 20 bps to 1.1 percent on sequential basis. 10 basis points is 0.01 percent.

Provisions and contingencies declined sharply by 40 percent sequentially to Rs 424 crore in September 2021 quarter, but the same increased by 27.3 percent year-on-year which resulted into a drag in profitability.

Kotak Mahindra Bank said Covid related provisions as of September 2021 were maintained at Rs 1,279 crore and did not utilise in the first half of FY22. "The bank has implemented total restructuring of Rs 495 crore (0.21 percent of advances), and in addition, the bank has implemented total restructuring of Rs 767 crore (0.33 percent of advances) as on September 30, 2021."

"Total provisions (including specific, standard, COVID-19 related etc.) held as on September 2021 at Rs 7,637 crore, around 100 percent of gross NPA," the bank said.

The bank further said SMA-II (special mention account) outstanding at the end of September 2021 quarter was at Rs 388 crore, down compared to Rs 430 crore as of June quarter.

Non-interest income (other income) grew significantly to Rs 1,812.6 crore in the quarter ended September 2021 driven by fee and services business, up from Rs 1,432.4 crore in corresponding quarter of last fiscal. Fee and services included distribution & syndication income, and general banking fees.

On consolidated basis, the profit growth was significant, rising 65.5 percent year-on-year to Rs 2,989 crore and the year-on-year growth was 1.4 percent.

Subsidiaries - Kotak Securities recorded 22.1 percent year-on-year growth in profit at Rs 243 crore and Kotak Mahindra Prime clocked 80.5 percent growth in profit at Rs 240 crore in the quarter ended September 2021.

Kotak Asset Management and Trustee Company's bottomline grew by 15.5 percent year-on-year to Rs 97 crore and Kotak Mahindra Capital Company registered a massive 314.3 percent growth YoY at Rs 58 crore, but Kotak Mahindra Life Insurance's profit declined 9.4 percent YoY to Rs 155 crore during the quarter.

The bank said consolidated customer assets grew by 16 percent year-on-year to Rs 287,831 crore as of September 2021. "Total assets managed / advised by the Group as of September 2021 were Rs 3,81,058 crore, up 40 percent over the corresponding period last fiscal."

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Indian Overseas Bank net profit up 154%

State-run Indian Overseas Bank (IOB) has posted a 154 per cent increase in net profit during the second quarter of the current financial year ended on September 30 to Rs 376 crore, as compared to Rs 148 crore during the same quarter in 2020-21.

The lender's total income for the reporting quarter was down marginally by about 1 per cent to Rs 5,376 crore, from Rs 5,430 during the July to September quarter of 2020-21. The bank’s managing director and chief executive officer P P Sengupta said the reasons for the better financial numbers is owing to a better outlook in the economy due to higher rates of vaccination and better performance in retail, agriculture, MSME (RAM) and corporates.

The bank’s asset quality showed signs of improvement with its gross non-performing assets falling by 11.29 per cent from Rs 17,660 crore during the second quarter in 2020-21 to Rs 15,666 during the same quarter this fiscal. During the quarter GNPA reduced by Rs 286 crore. GNPA ratios improved to 10.66 per cent from 13.64 per cent on a quarter on quarter basis. The bank came out of RBI's Prompt Corrective Action (PCA) on September 29, 2021.

Reduction in NPA for the quarter ended September 2021 stood at Rs. 1798 crore as against Rs.1,616 crore achieved for quarter ended June 2021. Net NPA during the quarter was seen at Rs 3,741 crore with a ratio of 2.77 per cent as against Rs 3,998 crore with a ratio of 3.15 per cent during the previous quarter.

The bank's net interest margin was 2.43 per cent in Q2 FY22, as against 2.57 per cent a year ago. During the quarter under review, IOB’s operating profit zoomed by 5.42 per cent to Rs 1,419 crore, as compared to Rs 1,346 crore seen during the September quarter last fiscal. Total deposits were seen up by 9 per cent to Rs.2,50,890 crore as on September end as compared to Rs 2,42,941 crore as on the quarter ended in June 2021.

Gross advances stood at Rs 1,46,940 crore during the quarter compared to Rs 1,38,944 crore during the end of Q1. The bank said that it has grown its retail and agri segments and rebalanced the advance balance by consciously reducing the stressed sector in the corporate segment.

CASA of the bank improved to 42.57 per cent during the period under review compared to 40.26 per cent during the same time last financial year. Total CASA also increased to Rs 106,806 crore as against Rs 92,436 crore during the second quarter of 2020-21. Provision Coverage Ratio improved to 92 per cent as against 89.36 per cent in Q2FY21.

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Central Bank of India net profit jumps 55% in Q2

Public sector Central Bank of India on Tuesday reported an over 55 percent jump in net profit at Rs 250 crore for the quarter ended September.

The lender had posted a net profit of Rs 161 crore during the same quarter of the previous fiscal.

However, total income of the bank during July-September period of 2021-22 was down at Rs 6,503.39 crore, as against Rs 6,762.36 crore in the year-ago period, it said in a regulatory filing.

Net interest income rose 5.99 percent to Rs 2,495 crore, as against Rs 2,354 crore earlier.

Net interest margin (NIM) improved from 3.21 percent to 3.36 percent on a year-on-year basis, registering an improvement of 15 basis points, it added.

On the asset quality front, net non-performing assets (NPAs or bad loans) reduced to 4.51 percent as of September 30, 2021, from 5.60 percent by end of the same month last year.

Gross NPAs moderated to 15.52 percent from 17.36 percent.

Also, the bank's cost of deposit declined to 3.84 percent from 4.45 percent for the reported quarter.

However, there was a slight uptick in provisions and contingencies for the quarter at Rs 1,048.52 crore, as against Rs 1,033.34 crore parked aside in the September 2020 quarter.

The state-owned lender said its slippage ratio stood at 1.45 percent as against 0.08 percent as there was a moratorium granted by RBI due to the COVID-19 pandemic. In the June 2021 quarter, it was 0.95 percent.

"Slippage ratio during the quarter increased due to slippage of two corporate accounts of Rs 1,150 crore. Had these accounts not slipped during the quarter then the slippage ratio for Q2FY22 would have been 0.67 percent," the bank said in a release.

Total business stood at Rs 5,12,094 crore as on September 30, 2021, compared to Rs 5,00,737 crore earlier, registering a growth of Rs 11,357 crore (2.27 percent) year-on-year.

Total deposits have increased by Rs 13,056 crore and stood at Rs 3,36,500 crore at the end of the quarter, from Rs 3,23,444 crore in the year-ago period, reflecting an increase of 4.04 percent, it added.

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Canara Bank Q2 Net profit jumps three times

 

State-owned Canara Bank reported a three-times rise in net profit at Rs 1,333 crore for the September quarter, riding on treasury and non-interest income and higher cash recovery.

The bank’s net profit was Rs 444 crore in the year-ago period.

Its net interest margin (NIM), a key profitability parameter, however, dipped to 2.72% in the quarter under review from 2.82% in the same period last year. Net interest income (NII) was a shade lower at Rs 6,273 crore from Rs 6,305 crore while total income rose a slim 2.6% at Rs 21,331 crore.

Its operating profit grew 22% to Rs 5,604 crore as against Rs 4,597 crore. Treasury income jumped 95% to Rs 1,754 crore while non-interest Income rose 37.5% at Rs 4,268 crore. Provision to cover bad loans fell 24% at Rs 2678 crore with improvement in recovery of loans that were already covered.

Bank chief executive LV Prabhakar expects corporate loans to grow at 7.5% for the full year despite muted demand so far, raising hopes of pick up in industrial activities. He expects retail loans to continue to grow by over 10%.

Canara’s gross advances grew 5.8% year-on-year (YoY) to Rs 6.87 lakh crore while the corporate loan portfolio rose 2.2% to Rs 2.96 lakh crore. The retail lending book rose 10.46% to Rs 1.19 lakh crore.

The lender’s asset quality improved sequentially, with gross non-performing assets (NPA) ratio falling to 8.42% at the end of September from 8.5% three months back. Net NPA stood at 3.21% as against 3.46%.

Prabhakar said the bank with 14.37% capital adequacy is comfortably placed for growth and meeting regulations. The lender has just recently raised Rs 1,500 crore in AT-1 capital while the board has approved raising another 2500 crore each in AT-1 bonds and tier-2 bonds. It raised Rs 2500 crore through share sales during this quarter.

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ICICI Bank reports highest ever net profit in Q2 as provisions fall

Country's second largest private sector lender ICICI Bank on October 23 recorded profit after tax of Rs 5,511 crore for the September 2021 quarter, increasing significantly by 30 percent compared to year-ago period, as provisions for bad loans declined, with improved asset quality performance. Double digit growth in net interest income, operating profit and other income also aided earnings for the quarter.

Net interest income, the difference between interest earned and interest expenses, has grown 25 percent to Rs 11,690 crore in Q2FY22, with 43 bps improvement YoY (11 bps QoQ) in net interest margin at 4 percent, said the bank in its BSE filing on October 23. One percent is equal to 100 basis points.

Loan and Deposits Growth

The bank further said total advances grew by 17 percent year-on-year to Rs 7.64 lakh crore in Q2FY22, with retail loan book (which accounted for 62.1 percent of total loan portfolio) growth at 20 percent, and 19 percent increase in domestic loan growth.

"The business banking portfolio grew by 43 percent year-on-year, and SME segment, comprising borrowers with a turnover of less than Rs 250 crore, registered a 42 percent YoY growth, for the September 2021 quarter," it added.

The bank, which had a network of 5,277 branches and 14,045 ATMs at September 2021, said total deposits increased by 17 percent year-on-year to Rs 9.77 lakh crore in Q2.

Asset Quality

Asset quality of the private sector lender improved further with increase recoveries & upgrades, and decline in NPA additions during the quarter. Gross non-performing assets (NPA) as a percentage of gross advances at 4.82 percent fell by 33 bps sequentially and net NPAs at 0.99 percent, the lowest since December 2014, declined 17 bps QoQ, in Q2FY22.

In absolute terms, "The net NPAs declined by 12 percent sequentially to Rs  8,161 crore at September 2021 from Rs 9,306 crore at June 2021," said ICICI Bank.

The bank further said the net addition to gross NPAs declined to Rs 96 crore  during Q2FY22 from Rs 3,604 crore in Q1FY22. The gross NPA additions declined to Rs 5,578 crore from Rs 7,231 crore in the same period.

"Recoveries and upgrades of NPAs, excluding write-offs and sale, increased to Rs 5,482 crore from Rs 3,627 crore on sequential basis. The gross NPAs written off were Rs 1,717 crore in Q2FY22," it added.

Excluding NPAs, the bank said the total fund based outstanding to all borrowers under resolution was Rs 9,684 crore or 1.3 percent of total advances at September 2021 compared to Rs 4,864 crore June 2021. "The bank holds provisions amounting to Rs 1,950 crore against these borrowers under resolution."

The loan and non-fund based outstanding to performing borrowers rated BB and below, reduced to Rs  12,714 crore from Rs 13,975 crore on quarter-on-quarter basis, said the bank.
Provisions. In addition, ICICI Bank continued to hold Covid-19 provisions of Rs 6,425 crore as of September 2021, the same level as June 2021.

The bank had provisions and contingencies at Rs 2,713.48 crore as of September 2021, declining 9.4 percent year-on-year and 4.8 percent quarter-on-quarter.

NII & PPOP

Non-interest income (other income) during the quarter grew by 19.1 percent YoY to Rs 4,797.18 crore, including few income, which contributed 79 percent to other income, grew 21 percent YoY to Rs 3,811 crore. However, there was a fall in treasury income to Rs 397 crore from Rs 542 crore YoY due to high base in Q2FY21 that included gain of Rs 305 crore from sale of shares in ICICI Securities.

Pre-provision operating profit (PPOP) during the quarter increased by 20 percent to Rs 9,915 crore compared to corresponding period previous fiscal.

The bank said with the increase in economic activity, disbursements across all retail products increased sequentially in Q2FY022. "Mortgage disbursements were close to the level seen in the quarter ended March 2021, reflecting the increase in demand coupled with the bank’s seamless customer onboarding experience through pre-approved offers and digitisation. Disbursements of personal loans and auto loans were also close to Q4FY21 levels."

The consolidated profit after tax (which included key subsidiaries and associates) was Rs 6,092 crore in Q2FY22, increasing from Rs 4,882 crore in Q2FY21.

Earlier this month, global rating agency Moody's has affirmed the long-term local and foreign current deposit ratings of ICICI Bank at Baa3. At the same time, its rating outlook has also been changed to stable from negative.

"The affirmation of ICICI Bank's deposit ratings and change in outlook to stable follows the change in outlook on the sovereign rating to stable. The previous negative outlook on the sovereign rating drove the negative outlook on the bank, because of strong linkages to the sovereign credit profile," said Moody's in its report dated October 6, 2021.

The private sector lender on October 1 acquired 9.9 percent equity stake in Midland Microfin, a non-banking financial company - microfinance institution, for Rs 52.42 crore.

Apart from this, in August, the bank had received approval from banking regulator Reserve Bank of India to re-appointment of Sandeep Bakhshi as Managing Director & CEO of the bank with effect from October 15, 2021 till October 3, 2023.

The stock has given significant return in the current financial year FY22, rising more than 30 percent with more than Rs 5 lakh crore in market capitalisation, outperforming Nifty Bank index by a strong margin which gained 21 percent in the same period. In fact both bank as well as index hit fresh record highs on Friday.

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Bank of Maharashtra Q2 Net profit doubles

 

State-owned Bank of Maharashtra has doubled its net profit at Rs 264 crore in the September quarter as against Rs 130 crore in the year-ago period, riding on sharp rise in net interest income and recovery from the Dewan Housing Finance (DHFL) exposure.

Its net interest margin, a gauge for efficiency, has improved to 3.27 per cent from 2.57 per cent over the same period. Operating profit grew 40.22 per cent at Rs 1061 crore as against Rs 756 crore. Its net interest income grew 34 per cent at Rs 1500 crore.

The bank recovered Rs 258 crore following DHFL's corporate resolution exercise.

Its asset quality also improved with gross non-performing assets ratio falling to 5.6 per cent at the end of September compared with 8.8 per cent a year ago. Net NPA reduced to 1.7 per cent from 3.3 per cent. Its provision coverage ratio was at 92.4 per cent.

The Pune-based lender grew its advances by 11.44 per cent year-on-year to Rs 1.15 lakh crore. "We are envisaging credit growth of 14-15 per cent for the entire FY22," chief executive AS Rajeev said.

It raised Rs 1,000 crore in bonds Wednesday to augment capital. The fund is raised at 7.8 per cent coupon.

"We have decided to raise another Rs 1000 crore in tier 2 bonds later in the year to keep its capital adequacy ratio (CAR) at around 14.5 per cent level," the CEO said.

Its CAR now stands at 14.67 per cent, an improvement from 13.18 per cent a year back.

Rajeev said the bank may consider raising equity capital in the first quarter next fiscal which would help it bring down government’s holding from 91 per cent. It had raised Rs 403 crore of equity through share sales to institutional investors that helped pare government holding marginally from 93.33 per cent.

The bank restructured loans worth Rs 1181 crore in the quarter under review, taking the total restructuring of standard loans to Rs 6,000 crore. The micro small and medium enterprise (MSME) borrowers accounted for about Rs 2400 crore of loan restructuring while restructuring of retail loans amounted to Rs 2,077 crore and corporate loans amounted to Rs 1000 crore. The balance amount is related to the farm sector.

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IDBI Bank Q2 results: Net profit up 75%

IDBI Bank reported a 75 per cent year-on-year (yoy) increase in second quarter standalone net profit at ₹567crore, supported by a huge write-back in provisions for non-performing assets (NPAs) and lower tax expense.

The Bank had posted a net profit of ₹324 crore in the year ago quarter.Net interest income increased 9 per cent yoy in the reporting quarter to ₹1,854 crore (₹1,694 crore in the year ago quarter).

Other income, including income from non-fund based banking activities such as commission, fees, earnings from foreign exchange and derivative transactions, and profit and loss from sale of investment, declined about 4 per cent yoy at ₹846 crore (₹881 crore).

The received a write-back of ₹1,426 crore in provisions for NPAs against ₹165 crore in the year ago quarter. Tax expense burden was lower at ₹215 crore (₹347 crore).

As at September-end 2021, gross advances barely nudged up to ₹1,64,506 crore (₹1,63,841 crore as at September-end 2020).

Rakesh Sharma, MD & CEO, said the Bank has built up a sanctions pipeline in the mid and large corporate segments and disbursals are expected to pick up from year-end onwards.

The Bank expects to grow its corporate loan book by about ₹6,000 crore in the current financial year.

Samuel Joseph, Deputy Managing Director, said the Bank has an exposure of about ₹400 crore to the SREI group, which is undergoing corporate insolvency resolution process, and has made 100 per cent provision towards this exposure. IDBI Bank recovered ₹196 crore from DHFL.

P Sitaram, CFO, emphasised that the Bank will grow the corporate loan book even as the emphasis will continue to be on structured retail loans.

Gross NPAs declined about ₹1,186 crore during the reporting quarter to ₹34,408 crore.

Gross NPAs as a percentage of gross advances declined to 20.92 per cent against 21.48 per cent in the preceding quarter. Net NPAs, however, nudged up to 1.62 per cent of net advances against 1.56 per cent.

Fresh slippages rose by ₹1,438 crore (₹1,332 crore in the first quarter). The Bank settled NPAs aggregating ₹1,436 crore (₹587 crore).

ends.

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Federal Bank net profit jumped 50% on lower provisions

 

Private sector lender Federal Bank reported a near 50 per cent jump in net profit for the September quarter on lower provisions and improvement in asset quality even as its total income shrunk.

The market gave a thumbs up to the numbers with the shares rising to their 52-week high of Rs 105.6 on BSE. The prices settled at Rs 104.5, which is about 8 per cent higher than the previous close.

The net profit stood at Rs 460 crore compared with Rs 308 crore in the year-ago period. Total income fell about 3 per cent at Rs 3824 crore from Rs 3937 crore.

Operating profit fell by about 9 per cent at Rs 865 crore from Rs 947 crore over the same period. However, a 54 per cent lower provisions at Rs 245 crore helped the net profit surge. Amortisation of the Rs 166 crore of additional liability on account of revision in family pension also helped.

The bank's asset quality improved on a sequential basis with the gross non-performing assets ratio being at 3.24 per cent at the end of September as compared with 3.50 per cent a quarter ago. Its net NPA stood at 1.12 per cent as against 1.23 per cent earlier.

The lender's net interest income, the difference between interest earned and interest expended, rose about 7 per cent at Rs 1,479 crore. Net interest margin for the quarter rose to 3.2 per cent from 3.13 per cent in the year-ago period.

"Our credit cost was negative in this quarter helped by reduced slippages and higher recovery and upgrade," managing director Shyam Srinivasan said.

The lender's gross advances grew 9.7 per cent year-on-year to Rs 1.37 lakh crore while deposits rose at almost the same rate to Rs 1.72 lakh crore.

Its current and savings account ratio to total deposits reached 36 per cent, an all-time high for the bank, Srinivasan said.

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YES Bank Q2 Results: Net profit soars 74% YoY

YES Bank today reported a 74.3 per cent year-on-year growth in net profit to Rs 225 crore for the quarter ended September as against analysts’ expectations of a Rs 31 crore net loss.The lender’s net interest income in the quarter, however, fell 23.4 per cent on-year to Rs 1,512 crore, which was below analysts’ expectations.

The healthy bottomline performance of the lender was thanks to a sharp decline in provisions. YES Bank’s provisions for bad loans declined 65 per cent year-on-year to Rs 377 crore.

The lender also reported a marked improvement in its asset quality in the quarter as gross non-performing loans ratio fell to 15 per cent from 15.6 per cent in the previous quarter. Similarly, net NPA ratio came in at 5.5 per cent as against 5.8 per cent in the previous quarter.

YES Bank said gross restructured loans at the end of the quarter were at Rs 6,184 crore. Overdue book, loans on which payments are due for more than 30 days but less than 90 days, declined Rs 6,000 crore sequentially.

Impressively, YES Bank’s current account-savings account ratio increased to 29.4 per cent in the reported quarter from 27.4 per cent in the previous quarter. At the same time, the portion of retail loans in total loan disbursements in the quarter improved 100 basis points sequentially to 55 per cent.

YES Bank’s advances posted a 3.5 per cent year-on-year growth but rose 5.6 per cent on a sequential basis. Deposits showed a remarkable 30 per cent on-year growth indicating that the lender is winning back the trust of customers.

However, the operating performance of the lender was underwhelming as operating profit declined 45.8 per cent on-year to Rs 678 crore. The net interest margin in the quarter fell 2.2 per cent from 3.1 per cent in the year-ago quarter.

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South Indian Bank reports Q2 net loss on higher bad loans

Kerala-based South Indian Bank (SIB) posted a net loss of Rs 187.06 crore during the second quarter (Q2) of the current financial year, as against a net profit of Rs 65.09 crore during the corresponding period of the previous year due to higher bad loans.

The bank declared an operating profit of Rs 111.91 crore for the Q2 FY 22 as against Rs 390.94 crore for the Q2 FY21. Murali Ramakrishnan, managing director and chief executive officer of the Bank, while announcing the results stated that the prevailing COVID Pandemic scenario in the country, impacted the growth in the Business and Personal loan segment. However, the Bank could register reasonable growth in the desired segments like well rated Corporates and Gold Loan portfolios during the period.

As per the recent RBI direction, provision for depreciation on investments amounting to Rs 175.56 crores for Q2 FY 22 has been shown under “other income” in the profit and loss account, which was originally classified under “provisions and contingencies”. Further, amounts recovered from written off accounts were reclassified under “provisions and contingencies” against previous year classification under “other income”. Excluding these amendments operating profit would have been Rs 346 crore.

The GNPA for the Bank improved by 137 bps to 6.65 per cent as at September 30, 2021 compared to 8.02 per cent as at June 30, 2021. CASA ratio for the Bank improved to 30.8 per cent as at September 30, 2021 compared to 27.8 per cent as at September.

During this quarter the Bank could improve the Provision Coverage Ratio to 65.02 per cent as on as against 60.11 per cent during the same time last fiscal. The Capital Adequacy Ratio of the Bank stands at 15.74 per cent as on September 30, 2021.

Murali added that the Bank has seen major shifts over the last one year in the key functional areas including major strides in digital banking, setting up vertical asset structure, revamping branch structure to bring efficiencies, developing new business sourcing channels, strengthening data science capabilities, employee engagement and motivation and robust recovery mechanism.

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HDFC Bank Q2 Result, Profit grows 17.6%

HDFC Bank, the largest private sector lender in India, has reported standalone profit at Rs 8,834.31 crore for September 2021 quarter, a 17.6 percent higher compared the corresponding period last fiscal, driven by higher other income, and marginal increase in provisions. The sequential growth in profit was at 14.3 percent for the quarter.

Net interest income, the difference between interest earned and interest expended, increased 12.1 percent YoY to Rs 17,684.4 crore during the quarter, with healthy loan growth.

"Advances grew at 15.5 percent reaching new heights driven through relationship management, digital offering and breadth of products. Core net interest margin was at 4.1 percent," said HDFC Bank in its BSE filing.

The advances increased to Rs 11.98 lakh crore in Q2FY22 YoY and the same increased 4.4 percent, sequentially. Loan growth was supported by, "retail segment that registered 12.9 percent YoY growth and commercial & rural banking segment that grew 27.6 percent YoY during the quarter," said the bank, adding other wholesale loans grew by around 6 percent YoY.

The bank further said new liability relationships added during the quarter were at an all-time high. "This continued focus on deposits helped in the maintenance of a healthy liquidity coverage ratio at 123 percent, well above the regulatory requirement, which positions the bank favourably to capitalise on the opportunities that would arise as the economy gains momentum during the festive months.

Deposits at Rs 14.06 lakh crore in the quarter ended September 2021 increased 14.4 percent compared to corresponding period previous fiscal, with retail deposits growth 17.5 percent and wholesale deposits at 2 percent YoY.

Provisions and contingencies at Rs 3,924.66 crore for the September quarter included contingent provisions of Rs 1,200 crore, growing 6 percent over a year-ago period but declined 18.8 percent on sequential basis.

The bank said it held floating provisions of Rs 1,451 crore and contingent provisions of Rs 7,756 crore as of September 2021, and total provisions were 163 percent of the gross non-performing loans as of September 2021.

Provision coverage ratio improved further to 70.9 percent in the second quarter of FY22, from 67.9 percent in June quarter.

On the asset quality front, gross non-performing loans at 1.35 percent of gross advances as of September 2021 were higher compared to 1.47 percent in June 2021 quarter, while net non-performing assets at 0.4 percent for the quarter declined from 0.48 percent in previous quarter.

Pre-provision operating profit at Rs 15,807.3 crore in Q2 grew by 14.4 percent over the corresponding period of previous year, the slowest growth in 21 quarters.

HDFC Bank said other income (non-interest income) at Rs 7,400.8 crore in Q2FY22 grew by 21.5 percent year-on-year, as fees & commissions, which accounted for 67 percent of other income, jumped 25.5 percent to Rs 4,945.9 crore YoY.

Foreign exchange & derivatives revenue, and miscellaneous income (recoveries and dividend) grew by 55 percent to Rs 867 crore and 58.5 percent to Rs 912 crore YoY respectively, but gain on sale/revaluation of investments fell 33.5 percent to Rs 675.5 crore in the same period, it added.

During the quarter ended September 2021, the private sector lender purchased loans aggregating Rs 7,132 crore through the direct assignment route under the home loan arrangement with promoter Housing Development Finance Corporation.

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IndusInd Bank Q2 Net profit declines 53%

IndusInd Bank on Friday posted a 52.7 per cent decline in consolidated net profit for the quarter ended September at Rs 663.08 crore.

The private lender had reported a net profit of Rs 1,400. 96 crore a year ago. An ET Now poll had projected the figure at Rs 800 crore.

The bank’s total income came in at Rs 8,731.52 crore, down 1.65 per cent from Rs 8,877.53 crore.

IndusInd Bank’s provisions rose 166 per cent to Rs 1,964.44 crore, from Rs 737.71 crore a year ago.

Its capital adequacy ratio stood at 16.55 per cent, from 14.70 per cent a year ago.

The bank’s gross NPA in the quarter stood at Rs 4,532.15 crore, compared with Rs 4,370.20 crore a year ago. Its net NPA came in at Rs 1,055.81 crore, compared with Rs 2,202.57 crore a year ago.

Gross NPA ratio stood at 2.21 per cent, compared with 2.19 per cent a year ago, while net NPA was 0.52 per cent, compared with 1.12 per cent in the year ago period.

The bank’s Net Interest Income (NII) for the quarter increased to Rs 3,278 crore from Rs 2,909 crore a year ago, and the Net Interest Margin (NIM) for Q2FY21 came in at 4.16 per cent.

It generated a fee income of Rs 1,554 crore in the quarter, compared with Rs 1,727 crore for the corresponding quarter of previous year.

“The business was highly impacted in Q1FY21 due to lockdown since March 24, 2020, to mitigate the spread of Covid-19 pandemic. The calibrated unlocking commenced from June 01, 2020; and industrial and consumer spends are near pre-Covid levels in some areas,” the bank said in a release.

The bank’s total deposits as of September 30 were Rs 2,27,884 crore, an increase of 10 per cent from Rs 2,07,193 crore a year ago.

CASA deposits stood at Rs 91,846 crore with current account deposits at Rs 34,773 crore and savings account deposits at Rs 57,073 crore. CASA deposits comprised of 40 per cent of total deposits as of September 30.

Advances as of September 30, were Rs 2,01,247 crore, compared with Rs 1,97,113 crore a year ago.

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Bank of Maharashtra Q2 profit up 13% on higher interest income, lower provisioning

 

Bank of Maharashtra on Monday reported 13.44 per cent growth in standalone net profit at Rs 130 crore for September quarter, helped by lower provisioning and higher interest income. “The bank logged a profit after tax of Rs 115 crore in the second quarter of 2019-20. On a consolidated basis, its profit stood at Rs 130.44 crore, compared to Rs 115.15 crore in the year-ago period.”

“Profit increase was mainly due to the net interest income (NII), which grew by around 5 per cent. There was considerable reduction in operating expenses by around Rs 75 crore. Provisions have also come down as asset quality improved,” Managing Director and CEO A S Rajeev told reporters.

He said the bank had an interest reversal of Rs 300 crore which it kept as provisions in the second quarter for COVID-19 and for some of the accounts that were not classified as NPA. Rajeev said had the bank not kept aside the interest reversal amount as provisions, NII growth would have been 14-15 per cent in the second quarter.

Net interest margin stood at 2.62 per cent for the quarter as against 2.77 per cent in the year-ago quarter. Rajeev said, “so far the bank has restructured 800 small accounts, including MSMEs, worth Rs 40 crore, under the Reserve Bank of India’s one-time restructuring scheme for accounts affected by COVID-19 related stress.” It has restructured 25 MSME accounts worth Rs 4-5 crore. For the corporate loans, the lender received two applications, of which one is not eligible.

“The other application of amount (bank’s exposure) Rs 200 crore is pending. It is a consortium account and a decision will be taken at the consortium level,” he said. “Gross NPA reduced to 8.81 per cent from 16.86 per cent. Net NPA declined to 3.30 per cent as against 5.48 per cent. Total provisions stood at Rs 676 crore as against Rs 637 crore. Provision for NPAs was Rs 43 crore as against Rs 404 crore.” Provision Coverage ratio improved to 87.15 per cent as compared to 82.71 per cent. The bank holds cumulative COVID-19 provision including interest of Rs 925 crore (out of which Rs 500 crore provision was made in the second quarter).

“In pursuance of the Supreme court order, the bank has not declared those accounts as NPA which were not declared NPA till August 31, 2020.” As a matter of prudence, the lender made additional provision of Rs 120 crore. Capital adequacy stood at 13.18 per cent with common equity tier 1 ratio of 10.31 per cent as at end-September. The bank’s total deposits grew 12.15 per cent year-on-year to Rs 1,58,626 crore. Gross advances rose 13.13 per cent to Rs 1,03,408 crore.

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Indian Overseas Bank(IOB) Q2 turns around to profits on lower provisioning

State-owned Indian Overseas Bank (IOB) on November 6 reported a net profit of Rs 148 crore for the second quarter of current fiscal as bad loans and provisions declined.

The Chennai-headquartered lender had registered a net loss of Rs 2,254 crore in July-September quarter a year ago. Sequentially, net profit grew 22.3 percent from Rs 121 crore in June quarter of this fiscal.

Total income rose 8.1 percent to Rs 5,431 crore during the quarter under review as against Rs 5,024 crore in the same quarter of 2019-20, Indian Overseas Bank (IOB) said in a regulatory filing. Interest income increased to Rs 4,363 crore from Rs 4,276 crore a year ago.

There was a substantial improvement in bank's asset quality as the gross non-performing assets (NPAs) plunged to 13.04 percent of the gross advances as of September 30, 2020 from 20 percent at the end of September 2019. In value terms, gross NPAs or bad loans fell to Rs 17,659.63 crore as against Rs 28,673.95 crore a year ago.

Net NPAs reduced to 4.30 percent (Rs 5,290.60 crore) from 9.84 percent (Rs 12,507.97 crore) a year ago. Total fresh slippages (other debits to existing NPA accounts) for September quarter were contained at Rs 292 crore, the lender said.

"Total cash recovery for September 2020 was Rs 513 crore (including cash recovery) as against Rs 172 crore in June 2020," it said.

Provisions for bad loans and contingencies fell to Rs 1,192.55 crore during the quarter under review from Rs 2,996.04 crore set aside in the year-ago quarter.

IOB said it has made required provisioning in advances in specific accounts so as to improve net NPAs. The bank's gross advances fell to Rs 1,35,469 crore as of September 30, 2020 from Rs 1,43,350 crore a year ago. However, it was slightly higher from Rs 1,31,565 crore at the end of June 2020.

"The bank has evolved a policy of not taking fresh exposures in stressed sectors, below hurdle rated accounts and BB and below rated accounts. The bank has also exited from accounts in the stressed sectors, wherever feasible," it said. The bank has grown under retail and agri sector and re-balanced the advance balance by consciously reducing the stressed sector in corporate segment, it added.

Provision coverage ratio improved to 89.36 percent at the end of September 2020 as against 75.85 percent at the end of September 2019. IOB's average cost of deposit reduced to 4.89 percent from 5.41 percent, while net interest margin improved to 2.18 percent for the quarter as against 1.86 percent in the year-ago period.

The bank said on relaxation of COVID-19 related lockdowns, it started mega e-auction process pan-India for sale of properties. The first such e-auction was conducted, fetching countable recovery by sale of properties and such e-auctions are planned to be conducted every month like in 2019-20, IOB said.

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Union Bank of India sees net profit jump 55%

 State owned Union Bank of India on Friday reported a 55.3 per cent jump in its net profit at Rs 517 crore in the second quarter ended September.

The bank had posted a net profit of Rs 333 crore in the same quarter a year ago.

Net interest income grew by 6.1 per cent to Rs 6,293 crore in the July-September period of 2020-21 from Rs 5,934 crore in the same period of 2019-20, it said in a release.

Gross Non-Performing Assets (NPAs) ratio improved to 14.71 per cent of the gross advances at the end of September this year from 15.75 per cent by September 2019.

Net NPAs fell to 4.13 per cent as of September from 6.40 per cent in the year-ago period.

Provision coverage ratio improved to 83.16 per cent as of September 30, 2020, compared to 74.26 per cent in the year-ago period.

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Central Bank of India Q2 Results: Net profit rises 20%

Central Bank of India on Friday reported over 20 per cent rise in its net profit at Rs 161 crore for the second quarter ended September 30. The bank had posted a net profit of Rs 134 crore in the corresponding quarter of the previous financial year.

Its total income grew nearly 2 per cent to Rs 6,833.94 crore during July-September 2020, against Rs 6,703.71 crore in the year-ago period, Central Bank of India said in a regulatory filing.

Operating profit improved to Rs 1,458 crore, registering a growth of 42.16 per cent from Rs 1,026 crore a year ago, it said.

The lender also improved on its bad assets ratio with the gross non-performing assets (NPAs) falling to 17.36 per cent of gross advances by the end of September 2020, from 19.89 per cent by the end of September 2019.

Net NPAs fell to 5.60 per cent, against 7.90 per cent in the year-ago quarter.

In value terms, the gross NPAs fell to Rs 30,785.43 crore from Rs 33,497.22 crore, while net NPAs stood at Rs 8,683.58 crore as against Rs 11,551.91 crore.

Provisions for bad loans and contingencies, however, rose to Rs 1,104.92 crore for the reported quarter of 2020-21, from Rs 791.33 crore in the year-ago period.

The bank's total business stands at Rs 5,00,737 crore as against Rs 4,73,080 crore, it added.

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