HDFC Bank on Saturday reported nearly 20 per cent rise in standalone net profit at Rs 6,658.62 crore for June quarter, 2020-21 on the back of healthy interest income driven by growth in advances.
The country’s largest private sector lender clocked a net profit of Rs 5,568.16 crore in the April-June period of 2019-20.
Income of the bank rose to Rs 34,453.28 crore in June quarter from Rs 32,361.84 crore in the year-ago same period, HDFC Bank said in a regulatory filing.
“Net interest income (interest earned less interest expended) for the quarter ended June 30, 2020 grew by 17.8 per cent to Rs 15,665.4 crore from Rs 13,294.3 crore for the quarter ended June 30, 2019, driven by growth in advances of 20.9 per cent, and a growth in deposits of 24.6 per cent,” the Mumbai-based lender said.
The net interest margin for the quarter was at 4.3 per cent.
“The continued slowdown in economic activity has led to a decrease in retail loan origination, sale of third party products, use of credit and debit cards by customers, efficiency in collection efforts and waivers of certain fees. As a result, fees/other income were lower by approximately Rs 2,000 crore,” the bank said further.
On the asset quality front, there was improvement as gross non-performing assets (NPAs) fell to 1.36 per cent of the gross advances as on June 30, 2020 from 1.40 per cent by the end of June 2019.
In value terms, gross
NPAs or bad loans were at Rs 13,773.46 crore as against Rs 11,768.95 crore.
Likewise, net NPAs fell to 0.33 per cent (Rs 3,279.96 crore) from 0.43 per cent (Rs 3,567.18 crore), the bank said in the filing.
However, the bank’s provisions for bad loans and contingencies for April-June 2020-21 were raised to Rs 3,891.52 crore as against Rs 2,613.66 crore in the year-ago same period.
The bank said the enhanced provisions for the quarter consisted of specific loan loss provisions of Rs 2,739.8 crore and general and other provisions of Rs 1,151.7 crore. Compared to this, the specific loan loss provisions were Rs 2,248 crore and general and other provisions were at Rs 365.7 crore for the year-ago same quarter.
“Total provisions for the current quarter included contingent provisions of approximately Rs 1,000 crore,” HDFC Bank said.
Among others, the total deposits of the bank as of June 30, 2020 grew by 24.6 per cent to Rs 11.89 lakh crore.
CASA (current account savings account) deposits grew by 26 per cent with savings account deposits at Rs 3.27 lakh crore and current account deposits at Rs 1.50 lakh crore.
The bank’s continued focus on deposits helped in the maintenance of a healthy liquidity coverage ratio at 140 per cent, well above the regulatory requirement, it added.