RBL Bank net profit surges 110%, asset quality improves

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January 29, 2021 1:20 AM

The operating profit grew 10% y-o-y and 11% q-o-q to Rs 805 crore. The net interest income, however, declined 2% y-o-y and 3% q-o-q to Rs 908 crore. Similarly, net interest margins declined 38 basis points (bps) y-o-y and 15 bps q-o-q to 4.19%. The core fee income showed a 37% q-o-q and 5% y-o-y growth to Rs 497 crore.

The capital adequacy of the lender stood at 17.9% at the end of December 2020.

The net profit of RBL Bank for the December quarter (Q3FY21) more than doubled on a year-on-year (y-o-y) basis to Rs 147 crore. The push in the bottom line came from other income and improved asset quality.

Other income surged 19% y-o-y and 27% quarter on quarter (q-o-q) to Rs 580 crore. RBL Bank said around 60% of other income came from the credit card business.

The operating profit grew 10% y-o-y and 11% q-o-q to Rs 805 crore. The net interest income, however, declined 2% y-o-y and 3% q-o-q to Rs 908 crore. Similarly, net interest margins declined 38 basis points (bps) y-o-y and 15 bps q-o-q to 4.19%. The core fee income showed a 37% q-o-q and 5% y-o-y growth to Rs 497 crore.

Vishwavir Ahuja, managing director (MD) and chief executive officer (CEO), said: “We continue to grow granular deposits and reducing our funding and operating costs this financial year.” Ahuja added that the bank is monitoring the recovery in the economy and remain cautiously optimistic.

The asset quality improved in Q3FY21. Gross NPAs improved 150 basis points (bps) to 1.84%, compared with 3.34% in the previous quarter. Net NPAs came down 67 bps to 0.71% from 1.38% in the September quarter. The lender has not classified any NPAs since August 31, 2020 due to the interim order of Supreme Court. “Had the bank classified borrowers more than 90 days overdue on December 31, 2020 as NPA, GNPA would be 4.57% and net NPA would be 2.37%,” Ahuja said.

The provisioning coverage ratio stood at 86.4% during the December quarter, compared with 74.8% in the previous quarter. Provisions surged 16% q-o-q, but declined 4% y-o-y to Rs 610 crore. Deposits rose 4% sequentially and 7% y-o-y to Rs 67,184 crore. The current account savings account (CASA) ratio stood at 31.1%, exactly at the same level during Q2FY21.

Advances during the quarter under review came down 5% y-o-y, but remained flat sequentially at Rs 56,444 crore. Retail advances, however, saw a 16% y-o-y and 2% q-o-q growth to Rs 32,938 crore. Operating expenses came down 1% y-o-y to Rs 683 crore.

The capital adequacy of the lender stood at 17.9% at the end of December 2020.

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