RBL Q3 update: Deposits drop 2.9% on-quarter, fall in CASA

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RBL Bank Q3 update

Last week we covered the RBL story around the reason for its recent crash. The sudden exit of the CEO raised doubts on whether everything was well within the bank. However, RBI came up with the statement that RBL Bank is well-capitalized and has a high liquidity coverage ratio.  Bank has released its December quarter numbers yesterday ahead of the official announcement of the financial results for Q3FY22.

RBL Q3 update: Highlights from December quarter

RBL Q3 deposits: The total deposits fell from Rs 75,888 crore in the September quarter to Rs 73,637 crore in the December quarter, a drop 2.9%. The bank confirmed that a large number of retail depositors had withdrawn funds after the action from RBI in the last week. Hence, the fall in total deposits.

Retail deposits and deposits from small businesses: Bank reported an 11.3% Q-O-Q drop in retail deposits and deposits from small business customers at Rs 27,871 crore. For the December quarter, retail deposits and deposits from small business customers accounted for 37.8% of the total deposits.

Fall in CASA: Current and Saving Account Deposits fell by 5.30% in the December quarter. The CASA ratio fell nearly a percent from 35.4% (in September) to 34.4% in December.

RBL Q3FY22 updates: Normalcy to return in next two months

Sequentially, the numbers have fallen but Y-o-Y both total deposits as well as retail deposits and deposits from small business customers, increased by 9.61% and 14.16%, respectively. The bank expects to return to a normal state in the next two months as it is taking steps to stabilize business and financial results.

In the last one month, the RBL share price has fallen over 31%. While the intervention of RBI and the CEO leaving the bank before the tenure definitely raises some questions on the bank's functioning, the clarification from the central bank puts fears to rest. Investors should carefully monitor the developments in the bank and analyze the Q3 results diligently. 

RBL Bank Q3 update: Brokerage radar

Motilal Oswal: The brokerage house said that the current developments have raised concerns about the bank's ability to sustain a turnaround in its operating performance. They have put the rating under review and remain watchful of further developments and await further clarity in the 3QFY22 result.
Read our previous blog on the bank’s recent stock price crash