Economy

RBL Bank reports mixed Q3 earnings over weak business growth; NIM hits all-time high

Updated : January 23, 2020 11:16 AM IST

Its asset quality deteriorated as GNPA in absolute value increased by 31 percent quarter-on-quarter to Rs 2,010.5 crore.

The GNPA was aided by higher write-offs as the bank wrote off NPAs worth Rs 443 crore in Q3FY20.

RBL Bank’s business growth slowed down to 20 percent in the third quarter of FY20 from an average of over 30 percent in many previous quarters, according to the banks’ Q3 earnings. The slowdown, as mentioned by management, is on account of muted economic environment in the country.

The net interest margin of the bank came in at 4.57 percent, perhaps an all-time high for the bank. The bank’s net interest income rose 40.9 percent year-over-year to Rs 922.7 crore in Q3FY20.

The bank had raised Rs 2,701 crore in Q3, which helped them in strengthening their balance sheet in terms of capitalisation.

RBL Bank reported slippages of Rs 1,048 crore in the December quarter, down 24 percent from Rs 1,377 crore in the previous quarter.

Their asset quality deteriorated as gross non-performing assets in absolute value increased by 31 percent quarter-on-quarter to Rs 2010.5 crore in Q3.

Gross NPA ratio increased to 3.33 percent in the quarter as against 2.6 percent in Q2FY20. The GNPA was also aided by higher write-offs worth Rs 443 crore in Q3FY20.

The operating profit of the bank continues to grow strong, however elevated provisioning has meant that the bank has poorest return ratios amongst midcap private banks.

RBL Bank reports mixed Q3 earnings over weak business growth; NIM hits all-time high

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