IndusInd Bank Q3 results!
Last updated: 29 Jan, 2021 | 02:31 pm
Profit in line with estimates: The net profit fell 36.5% on a yearly basis to Rs 830.39 crores as against Rs 833.6-crore estimated by analysts. The fall was attributed to a sharp increase in provisions.
Net interest income rises: A bank’s primary business is to borrow money and lend the same at a rate higher than the rate at which they borrowed. The income generated from this differential is known as net interest income. Net interest income for the Bank grew 11% on a yearly basis to Rs 3,406 crore as against Rs 3,276.7crore estimated by analysts. Net interest margin remained flat at 4.12%.
Asset quality improves: Gross non-performing assets(GNPA) ratio fell to 1.74% while the net NPAs stood at 0.22%. They were at 2.21% and 0.52% in the same quarter a year ago.
Update on moratorium: The RBI had permitted banks to offer a moratorium to borrowers until the end of August to help them mitigate the impact of the pandemic. Following this, the Reserve Bank of India in September permitted one-time restructuring of advances of companies and retail borrowers hit by the Covid-19 pandemic. While these assets don’t have to be marked as NPAs, banks have been asked to disclose details of the restructured assets.
- IndusInd Bank said that “Had such an order not passed, the pro forma Gross NPA and Net NPA ratio of the bank would have been 2.93% and 0.70% respectively”
Provisions: Total provisions spiked by 77.6% on a yearly basis to Rs 1,853.52 crore as compared to Rs 1,043.45 last year.
The management said that the Indian economy is bouncing back strongly from the covid-19 impact and the vaccination drive will support this recovery further. The stress on asset quality is visible as the GNPA would have been higher by 1.2% had the banks were allowed to disclose fresh NPAs. The bank as however mentioned a cautious stance by spiking up provisions.