Money & Banking

AU Bank reports 13% decline in Q2FY22 net profit

Our Bureau Mumbai | Updated on October 28, 2021

Net interest income was up 34 per cent y-o-y to ₹753 crore

AU Small Finance Bank reported a 13 per cent year-on-year (y-o-y) decline in second quarter net profit at ₹279 crore despite robust increase in net interest income (NII) as the bottomline in the year-ago period was bumped up by income from sale of part stake in Aavas Financiers.

The Jaipur-headquartered bank had reported a net profit of ₹322 crore in Q2FY21, including ₹126 crore from the aforementioned sale.

Net interest income (difference between interest earned and interest expended) was up 34 per cent y-o-y to ₹753 crore (₹561 crore in the year-ago quarter).

Other income, including processing fee, profit/loss on sale of investments, income from dealing in priority sector lending certificates, declined about 27 per cent y-o-y to ₹191 crore (₹261 crore).

The bank said profit on sale of investment for the previous year includes profit earned on sale of equity shares (part stake) held in Aavas Financiers.

Write-back

AU SFB received a write-back of ₹170 crore in non-performing asset (NPA) provisions in the reporting quarter. It had made a provision of ₹16 crore in the year-ago quarter.

Gross NPA position improved to 3.2 per cent of gross advances as on September-end 2021 against 4.3 per cent as at June-end 2021. Similarly, net NPA reduced to 1.7 per cent from 2.3 per cent.

Sanjay Agarwal, MD & CEO, emphasised that if the one-time gain of ₹126 crore due to part stake sale in Aavas is excluded from the year-ago period net profit, then the bank has posted a 42 per cent increase in net profit in the reporting quarter.

He observed that as the economy is improving, the bank’s customers are coming back on the loan repayment track.

Assets under management were up 24 per cent to ₹38,011 crore. Deposits increased 45 per cent y-o-y to ₹38,011 crore.

Published on October 28, 2021

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