RBL Bank’s net profit rose 34% year-on-year (Y-o-Y) for the December quarter due to a strong growth in its loans and a fall in provisions. The bank posted a net profit of Rs 209 crore, a rise of 4% quarter-on-quarter.
Net advances rose 15% YoY and 6% QoQ to Rs 66,684 crore as on December 31. Within net advances, retail advances rose 13% YoY and 7% QoQ to Rs 34,977 crore. Retail advances comprised 52% of the bank’s overall loan book.
Rural vehicle finance saw a significant traction, rising 313% YoY. Housing loans rose 151% while microfinance loans rose 4%. Credit cards comprise 44.2% of retail advances. The micro-banking segment and housing loan segment comprises around 26% of retail advances.
Also read: More layoffs in the offing, Indian startups see 44% decline in hiring: Study
“We have largely consolidated our microfinance business under our subsidiary RBL Finserv. We lost a few weeks of disbursals under microfinance as we had transition to a new and robust system from the old system. We are, however, back to a disbursal run rate of over Rs 800 crore on a monthly basis in microfinance. Therefore, the disbursal in January-March should be markedly higher and continue to grow in the coming quarters,” R Subramaniakumar, managing director and chief executive officer, said.
“We forayed into two-wheelers, gold loans and used cars in the December quarter. We will look to progressively scale up these businesses in coming quarters. Our small business loans will also be launched in January-March,” he added.
Deposits rose 11% to Rs 81,746 crore as on December 31. Current account, savings account deposits rose 18% to Rs 29,948 crore. Retail deposits rose 25% to Rs 34,769 crore. Retail deposits comprise nearly 43% of overall deposits.
The bank’s net interest income rose 14% to Rs 1,148 crore. Net interest margin rose to 4.7% in October-December from 4.3% a year ago. It rose by 19 basis points on a sequential basis.
Asset quality
Gross non-performing asset ratio improved to 3.61% as on December 31 from 3.80% a quarter ago. Net non-performing asset ratio fell to 1.18% as on December 31 from 1.26% a quarter ago.
Net slippages fell to Rs 383 crore in the December quarter from Rs 498 crore a quarter ago. But, it was higher than Rs 313 crore a year ago.
The bank wrote-off loans worth Rs 371 crore in the December quarter. It recovered loans worth Rs 126 crore in the reporting quarter and upgraded loans worth Rs 99 crore to standard category from the NPA category.
The bank’s provisions fell 31% to Rs 293 crore, and this aided the bank’s bottom line. The bank’s provision coverage ratio, including technical write-offs, rose to 84.7% as on December 31 from 78.6% a year ago.
The total capital-to-risk (weighted) assets ratio improved to 17% as on December 31 from 16.6% a year ago.