IndusInd Bank net up 25% to Rs 620 cr on NII growth

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April 22, 2016 6:12 AM

IndusInd Bank on Thursday reported a 25.2% year-on-year growth in its net profit for the March quarter to R620.35 crore, gaining from a 37% rise in net interest income (NII), and an improvement of its net interest margin (NIM).

IndusInd Bank on Thursday reported a 25.2% year-on-year growth in its net profit for the March quarter to R620.35 crore, gaining from a 37% rise in net interest income (NII), and an improvement of its net interest margin (NIM).

Total income for the quarter came in at R4,044.49 crore, up 23.4% on year. NII, the difference between interest earned and interest expended, stood at R1,268.21 crore. The NIM, which was 3.68% for the March quarter last year, expanded to 3.94%.

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“This time around it has been fuelled by few new and more interesting, robust revenue streams. So, the interest income stream has started to pump quite well…So the interest income is coming back, fueled by the resurgence that we see in our retail book. It has also been accompanied by robust growth of credit on the corporate side,” Romesh Sobti, MD and CEO, said in a post-results press meet.

As a result of the Reserve Bank of India’s asset quality review, according to which banks had to identify and provide for certain bad loan accounts in the last two quarters of the previous fiscal, IndusInd Bank’s provisions for the quarter, at R213.66 crore, nearly doubled compared to the year- ago period.

Gross NPAs as a percentage of total advances rose from 0.81% at the end of March last year to 0.87% this time around. Net NPA, too, rose 5 basis points year-on-year to 0.36%.

The lender also witnessed healthy growth in its non-interest income, which rose 31% Y-o-Y to R912.80 crore. Core fee income, which accounts for the lion’s share of this pie, increased by 27% to R774.19 crore, while forex gains, gains made on trading of securities and in the money market brought in R138.61 crore, 54% more than in the same quarter last year.

“Our profitability and productivity parameters reflect healthy trends. The bank has delivered a consistent performance through the year. We have continued to focus on partnerships and associations that fit nicely into our strategy of creating scale with profitability in select business segments. Amid uncertain global sentiment, the outlook on Indian economy looks positive,” Sobti said.

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