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Federal Bank says retail loan growth continues to remain strong at over 25%

Updated : July 16, 2019 06:52 PM IST

Kerala-based Federal Bank on Tuesday said retail loan growth continues to remain strong at over 25 percent after the private lender reported a 46.25 percent jump in June quarter net at Rs 384.21 crore.

In an interview to CNBC-TV18, Shyam Srinivasan, managing director and chief executive officer, said, "Retail slippage of Rs 140 crore is certainly higher than our past few quarters. On average, it is about Rs 100 crore and this quarter it has gone up to Rs 140 crore. Out of the Rs 140 crore, Rs 100 crore is from one geography and driven by the fact that moratorium on loans after the floods in Kerala."

Srinivasan said, "Retail is growing over 32 percent. Retail is, of course, spread across the four areas - home loans, loan against property, personal loans and auto. In all areas we are growing, in fact in some areas well into the 50 percent but in a smaller base. So, the growth is quite diversified and granular."

The lender reported a 17.77 percent growth in core net interest income at Rs 1,154 crore on a 19 percent growth in advances, and a stable net interest margin which stood at 3.10 percent.

Boosting the bottom line, other income clipped 44.55 percent to Rs 391.52 crore. The bank saw fresh slippages of Rs 415 crore during the quarter, including Rs 32 crore to two special purpose vehicles of the crippled infra lender IL&FS, while the overall recoveries rose to Rs 300 crore.
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