The lender saw an increase of 33% year-on-year on the non-interest income front due to a 14% rise in fee income, which stood at R1,317 crore. The banks trading profit soared 193% from a year ago to R440 crore. Net interest margin (NIM) for the quarter also saw a sequential rise of 16 bps and stood at 3.86%.
Margins will probably trend down as our capital funds get used and the balance sheet expands. We have always maintained that we want to keep it in a band of 3.25-3.5%, said Somnath Sengupta, executive director and head-corporate centre, Axis Bank. Asset quality deteriorated marginally, with gross non-performing assets (NPAs) at R2,490 crore at the end of the quarter, up 4% sequentially. Net NPAs rose 12.15% from the previous quarter and stood at R790 crore. As a ratio of total assets, gross NPAs and net NPAs rose marginally to 1.1% and 0.35%, respectively.
Cumulative value of assets restructured till June 30 stood at R4,211 crore, lower than the R4,368-crore pile of restructured assets as on March 31, 2013. Restructured assets constituted 1.87% of gross customer assets. The bank saw fresh restructuring of R686 crore during the quarter.
The environment continues to be challenging and therefore the pipeline of restructured assets continues to be there. So what we have seen over the last few quarters is likely to continue for the next quarters, said V Srinivasan, executive director and head-corporate banking, while talking to reporters over a conference call after announcing the results.
On Thursday, Axis Bank stock ended at R1,238.40 per share, up 3.83% from the previous close.
Advances grew 16% year-on-year to R1,98,151 crore at the end of the quarter. Retail advances grew 40% from the previous year to R56,706 crore, and accounted for 29% of net advances of the bank compared to 24% last year.
Total deposits inched up 7% year-on-year at the end of the quarter to R2,38,441 crore. Current account savings account (Casa) deposits formed 39% of total deposits as on June 30. Retail deposits constituting savings bank deposits and retail term deposits, grew 19% year-on-year and stood at R1,26,605 crore.
In the investment book, the share of government securities was 62% while investments in other securities such as corporate bonds, equities, preference shares and mutual funds accounted for the balance.
The bank added 74 branches and 243 automated teller machines (ATMs) to its network during the first quarter.