Retail advances grew 43.3% y-o-y and 7.2% sequentially and accounted for 18.3% of all loans. Retail loan growth accounted for 60.5% of incremental y-o-y growth in advances.
Private-sector lender Yes Bank on Wednesday reported a net profit of Rs 113.8 crore in the quarter ended June, down 91% from the corresponding figure in the same quarter last year as provisions shot up 185% year-on-year (y-o-y) to Rs 1,784 crore. Net interest income (NII) rose 2.8% y-o-y to Rs 2,281 crore.
Net interest margin (NIM) fell 20 basis points (bps) sequentially to 2.8%. Pre-provisioning operating profit fell 28% y-o-y to Rs 1,959 crore. Asset quality at the bank deteriorated from the previous quarter, with the gross non-performing asset (NPA) ratio rising 179 bps to 5.01% and the net NPA ratio inching up 105 bps to 2.91%.
Yes Bank’s advances as on June 30 stood at Rs 2.36 lakh crore, up 10% from the previous year, while total deposits rose 6% y-o-y to Rs 2.26 lakh crore. Retail advances grew 43.3% y-o-y and 7.2% sequentially and accounted for 18.3% of all loans. Retail loan growth accounted for 60.5% of incremental y-o-y growth in advances. The current accounts savings accounts (Casa) ratio stood at 30.2%, down from 35.1% at the end of June 2018.
The bank reported gross slippages of Rs 6,232 crore in Q1FY20. Recoveries and upgrades aggregated to Rs 1,678 crore during the quarter. “Net corporate slippages were entirely from the accounts classified as BB & Below at end of Q4FY19,” Yes Bank said in a release. It sold one NPA account with an exposure of Rs 411 crore to an asset reconstruction company (ARC) during the June quarter.
In a call with analysts, Yes Bank managing director and CEO Ravneet Gill said the bank’s total real estate book is roughly Rs 24,000 crore and 25% of it has been isolated as sub-investment grade book or as NPAs. “Of the balance 75% of the book, I can tell you that we have minimal slippages and if I looked at the overall real estate book from the point of view of SMA2 (special mention accounts 2), that number is just a little over Rs 200 crore,” Gill added.
While the BB and below book at the bank has grown to 9.4% from 7.1%, the increase has fundamentally come on the back of two exposures to large financial services players, Gill said. These were clients of the bank even earlier but their ratings have subsequently deteriorated and become part of sub-investment grade book. “It would be fair to say that our asset quality has now stabilised,” he added.
Yes Bank’s provision coverage ratio (PCR) remained unchanged quarter-on-quarter (q-o-q) at 43.1%. Its capital to risk weighted assets adequacy ratio (CRAR) stood at 15.7% at the end of June 2019, with the tier I ratio at 10.7%.