RBL Bank’s profit declined 81% year-on-year to Rs 69 crore in the fourth quarter of the previous financial year, impacted by rise in provisions due to spike in bad loans. The Q4 FY25 numbers, announced on Friday, beat Street expectations as the analysts polled by Bloomberg had estimated the bank to post Rs 47.5 crore net profit in the quarter.
Net interest income, the difference between interest earned and paid, declined 2% to Rs 1,563 crore in the quarter from Rs 1,600 crore in the same quarter of FY24.
Provisions jumped 90% to Rs 785.14 crore from Rs 413 crore in the year-ago period, due to a rise in slippages in credit cards and microfinance segments.
“We have navigated a complex environment with resilience and focus, delivering strong momentum in secured retail and commercial banking, while deepening our base of granular, sticky deposits,” R Subramaniakumar, MD & CEO, RBL Bank said. “With proactive prudent provisioning on the JLG (Joint Liability Group) loan portfolio, bank is entering FY26 with a clean slate for the JLG business.”
The bank is targeting a mid-to-high teen growth in advances in the new fiscal, which will include an over 25% increase in retail assets on the back of growth in secured book, and doubling in the wholesale asset growth to 12%, Subramaniakumar added.
Other income of the bank rose 14% to Rs 1,000 crore during the quarter from Rs 875 crore in the year- ago period.
The asset quality improved as gross non-performing assets ratio declined to 2.6% at the end of March quarter from 2.92% in the preceding quarter. Net NPA also fell to 0.29% compared with 0.53% in the December quarter.
“We will remain cautious on the unsecured lending segment with a clear focus on quality over quantity” said Subramaniakumar.
Total deposits grew 7% to Rs 1.1 lakh crore while net advances grew 10% to Rs 92,618 crore. The bank’s board has recommended a dividend of Rs 1 per share for the year ended March 31, 2025.