IDBI Bank’s Q1 net rises 25% to Rs 756 cr as provisions, contingencies dip
Private sector lender IDBI Bank’s net profit rose 25 per cent year on year (YoY) to Rs 756 crore in the quarter ended June (Q1FY23), on the back of a sharp fall in provisions and contingencies.
The bank had posted a net profit of Rs 603 crore during the same period last year (Q1FY22). Sequentially, its net profit rose by 10 per cent from Rs 691 crore in Q4FY22.
The bank’s stock was trading 2.6 per cent higher at Rs 37.10 per share on BSE on Thursday. The lender, which is predominantly owned by Life Insurance Corporation of India and the Government of India, is a candidate for strategic divestment.
The lender’s net interest income (NII) declined by 1 per cent in Q1FY23 to Rs 2,488 crore from Rs 2,506 crore in Q1FY22. Sequentially, the NII was up by three per cent from Rs 2,421 crore in the quarter ended March 2002.
Its net interest margin (NIM) declined to 4.02 per cent in Q1FY23 from 4.06 per cent a year ago, but rose from 3.97 per cent in Q4FY22, according to an analysts’ presentation.
Other income fell by 34 per cent YoY to Rs 1,140 crore from Rs 1,731 crore in Q1FY22 and was up 35 per cent over Rs 844 crore in Q4FY22.
The provisions and contingencies fell by 48 per cent to Rs 959 crore in June 2022 quarter from Rs 1,844 crore in the year ago quarter. However, they rose 43 per cent from Rs 844 crore in the March 2022 quarter.
The bank’s asset quality profile improved with gross non-performing assets (GNPAs) declining to 19.9 per cent in June 2022 from 22.7 per cent in June 2021 and 20.16 per cent in March 2022. Net NPAs dipped to 1.25 per cent at end of Q1FY23 from 1.67 per cent a year ag0 and sequentially down from 1.36 per cent at end Q4FY22.
The provision coverage ratio (PCR) rose to 97.79 per cent for the quarter under review from 97.42 per cent a year ago and 97.63 per cent in March 2022.
The bank’s loans grew 9 per cent YoY to Rs 1.7 trillion at the end of June 2022, the bank said in a statement.
Its deposits grew by 1 per cent YoY to Rs 2.25 trillion in June 2022. But sequentially, they declined by 3 per cent from Rs 2.33 trillion in March 2022. The share of low cost money – current account and savings account (CASA) improved to Rs 55.65 per cent in June 2022 from 52.43 per cent a year ago.
The bank’s capital adequacy ratio (CAR) stood at 19.57 per cent in June 2022 as against 16.23 per cent in June 2021.