Bandhan Bank on Friday reported a whopping 138% jump in its net profit to Rs 886.50 crore for the first quarter of the current fiscal, aided by close to 19% year-on-year rise in net interest income (NII) and 56% Y-o-Y fall in provisions. The bank’s net profit for the year-ago period stood at Rs 373.08 crore. On a quarter-on-quarter basis, the net profit fell 53.4% from Rs 1,902.34 crore.
Non-performing assets (NPAs) increased 8.18% YoY to Rs 6,967.55 crore during the quarter under review, against Rs 6,440.38 crore for the corresponding period of last financial year. On a quarter-on-quarter basis, NPAs rose 9.2% from Rs 6,380 crore during the fourth quarter last fiscal, according to a stock exchange filing. On a year-on-year basis, the gross NPA ratio decreased 93 bps to 7.25%. However, the gross NPA ratio increased 79 bps sequentially.
Chandra Shekhar Ghosh, MD and CEO, said: “The first quarter of a financial year is a lean period for the industry. Therefore, the Q-o-Q comparison shows a dip (in profit). It is better to compare the first quarter of last year and the first quarter of this year.” According to Ghosh, with asset quality and credit cost stabilising, the bank’s focus during this fiscal will be on growing the balance sheet and product and geographic diversification.
Total advances grew 20.3% to Rs 96,649.7 crore as of June 30, 2022, against Rs 80,356.9 crore as on June 30, 2021. Net interest income (NII) for the June quarter grew by close to 19% to Rs 2,514.42 crore, compared with Rs 2,114.07 crore in the year-ago period. At the end of Q1FY23, NIM stood at 8%.
Gross slippages during the quarter came down on a sequential basis to Rs 1,125 crore, compared with Rs 1,365 crore during Q4FY22. The total restructured loan book, which had stood at Rs 7,547 crore last fiscal, came down to Rs 4,661 crore due to improved collections and recovery.
Ghosh said the bank does not expect any incremental provisioning on account of the restructured loan book moving forward. Overall collection efficiency stands at 96% and is expected to improve to close to 98% by the end of the current financial year, Ghosh said.