HDFC Bank on Wednesday reported a 30.1 per cent increase in its June quarter net at Rs 1,844 crore on the back of a healthy growth in retail lending.
Its net profit for the corresponding April-June period last year was Rs 1,417 crore. The bank’s net interest income was up 21 per cent at Rs 4,418.7 crore as against Rs 3,652.4 crore a year ago, driven largely by a credit growth of 21.2 per cent, which included a 25 per cent jump in retail lending. The proportion of retail loans in the portfolio grew to 54 per cent, while corporates accounted for the remaining.
“We believe that private consumption is still strong despite the overall difficulties on the economic front. Unless the investment cycle returns, we will see growth in retail lending outpacing the wholesale book,” HDFC Bank Executive Director Paresh Sukhtankar told reporters. The bank was able to retain its net interest margin (NIM) at 4.6 per cent, even though the ratio of the low-cost current and savings account (Casa) deposits fell below the 45 per cent level.
Sukhtankar said the bank is targeting to hold the NIM in the 4.1-4.6 per cent band. It was able to hold on to asset quality, with the gross non-performing assets ratio remaining flat at 1 per cent. Its fresh slippages were Rs 380 crore during the quarter, while the proportion of restructured advances improved to 0.2 per cent as against 0.3 per cent a year ago.
He said the generation of NPAs from retail lending, otherwise considered resilient to economic woes, was 55 per cent, while corporates generated the remaining 45 per cent.