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IndusInd Bank net jumps 64% in Q1 as bad loans dwindle

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IndusInd Bank net jumps 64% in Q1 as bad loans dwindle

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Shares of IndusInd Bank ended at Rs 878.45, up by Rs 9.95, or 1.15 percent on the BSE. The private sector bank beat forecasts by reporting a net profit of Rs 1,603.29 crore against estimates of Rs 1,415.24 crore for the quarter under review.

Private sector lender IndusInd Bank on July 20 reported a 64.4 percent year-on-year (YoY) jump in net profit at Rs 1,603.29 crore for the first quarter ended Jun 30, 2022, on a fall in bad loans.


In the corresponding quarter last year, the company posted a net profit of Rs 974.95 crore. CNBC-TV18 Polls had predicted a profit of Rs 1,415.24 crore for the quarter under review.

Net interest income

Net interest income for the quarter ended June 30, 2022, at Rs 4,125 crore, grew by 16 percent YoY and 4 percent QoQ. Net interest margin for the first quarter stood at 4.21 percent against 4.06 percent for the first quarter of 2022 and 4.20 percent for Q4 of FY 2022.

Other income stood at Rs 1,932 crore for the quarter ended June 30, 2022 against Rs 1,723 crore for the corresponding quarter of the previous year, which grew by 12 percent YoY. Core fee grew by 47 percent to Rs 1,786 crore against Rs 1,214 crore for the corresponding quarter of the previous year.

Operating expenses for the quarter ended June 30, 2022 climbed to Rs 2,626 crore against Rs 2,166 crore for the corresponding quarter of the previous year, growing by 21 percent.

Pre-provision operating profit 

Pre-provision operating profit (PPOP), at Rs 3,431 crore for the quarter ended June 30, registered a growth of 10 percent over the corresponding quarter of the previous year at Rs 3,121 crore. PPOP, or advance ratio, for the quarter ended June 30, 2022, was steady at 5.70 percent.

Asset quality

The gross NPA was at 2.35 percent of gross advances as of June 30, 2022, against 2.27 percent as of March 31, 2022. Net non-performing assets were 0.67 percent of net advances as of June 30, 2022, compared to 0.64 percent on March 31, 2022. The provision coverage ratio was consistent at 72 percent as of June 30, 2022.

Provisions and contingencies for the quarter ended June 30, 2022, were Rs 1,251 crore compared to Rs 1,780 crore for the corresponding quarter of the previous year, down by 30 percent YoY. Total loan-related provisions as of June 30, 2022, were at Rs 8,370 crore (3.38 percent of loan book).

Capital adequacy ratio

The bank's total capital adequacy ratio (CAR) as per Basel III guidelines improved to 18.14 percent as of June 30, 2022, compared to 17.57 percent as of June 30, 2021.

Tier I CAR was at 16.55 percent as of June 30, 2022, compared to 16.87 percent as of June 30, 2021. Risk-weighted assets were at Rs 3,118 crore as against Rs 2,72,367 crore a year ago.

Deposits

Deposits as of June 30, 2022, were Rs 3,02,719 crore against Rs 2,67,233 crore, an increase of 13 percent over June 30, 2021. CASA deposits increased to Rs 1,30,508 crore with current account deposits at Rs 35,265 crore and savings account deposits at Rs 95,243 crore.

CASA deposits comprised 43 percent of total deposits as of June 30, 2022. Advances as of June 30, 2022, were Rs 2,47,960 crore against Rs 2, I0,727 crore, an increase of 18 percent over June 30, 2021.

The results came after the close of the market hours.

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