IDFC First Bank net profit up 50 pc at Rs 152 cr in Sept-quarter

IDFC First Bank on Saturday reported a nearly 50 per cent jump in standalone net profit at Rs 151.74 crore for the quarter ended September 2021, with the collection efficiency surpassing pre-COVID levels

NII (net interest income) grew by 27 per cent on a year-on-year basis to reach Rs 2,272 crore in Q2 FY22, the bank said. Source: Website

IDFC First Bank on Saturday reported a nearly 50 per cent jump in standalone net profit at Rs 151.74 crore for the quarter ended September 2021, with the collection efficiency surpassing pre-COVID levels.

The bank had posted a net profit of Rs 101.41 crore in the same quarter a year ago. Sequentially, there was a net loss of Rs 630 crore in the quarter ended June 2021.

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Total income during the July-September period of FY22 rose to Rs 4,880.29 crore, as against Rs 4,090.87 crore in the same quarter of FY21, it said in a regulatory filing.

The interest income stood at Rs 4,100.58 crore, up from Rs 3,924.86 crore.

NII (net interest income) grew by 27 per cent on a year-on-year basis to reach Rs 2,272 crore in Q2 FY22, the bank said.

Provisioning for bad loans and contingencies were raised substantially to Rs 474.95 crore as bad loans rose. The bank had parked aside Rs 213.40 crore towards the same in the year-ago period.

There was impairment on the asset quality front, with the gross non-performing assets (NPAs or bad loans) spiking to 4.27 per cent of the gross advances by end of Q2 FY22, as against 1.62 per cent earlier.

Value-wise, it stood at Rs 4,485.53 crore, as against Rs 1,486.11 crore.

Net NPAs too rose to 2.09 per cent (Rs 2,150.34 crore) from 0.43 per cent (Rs 390.95 crore).

However, the bank said gross and net NPAs for the quarter ended September 30, 2020 are not comparable as an interim Supreme Court order had directed banks that accounts which were not declared as NPA till August 31, 2020, shall not be declared as non-performing accounts. The order related to the pandemic driven financial stress.

On a consolidated basis, the bank posted a net profit of Rs 110.95 crore, slightly up from Rs 109.03 crore earlier. Total income rose to Rs 4,830.14 crore from Rs 4,090.91 crore.

The retail loan assets grew by 30 per cent from a year ago to reach Rs 78,048 crore, primarily driven by growth in home loans which grew by 46 per cent, said the lender.

"Early bucket collection efficiency surpassed pre-COVID levels for both urban and rural retail loans," it added.

IDFC First Bank Managing Director and CEO V Vaidyanathan said, "We are seeing strong revival of the economy and strong demand for home loans, loan against property, MSME and consumer loans. The retail loan book is now highly diversified across over 10 lines of business and millions of customers."

The quality of the deposit franchise also improved significantly; he said, adding the CASA (current account savings account) ratio has sustained at upwards of 50 per cent even after reducing rates.

"As far as asset quality is concerned, we are confident that we will soon revert to the pre-COVID levels of gross and net NPA of 2 per cent and 1 per cent again in the retail business as seen from improvement in the input indicators such as cheque/mandate bounce percentages, collection efficiency and recoveries," he added.

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