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Private sector lender Axis Bank, on Friday, posted an 82.6 per cent increase in net profit at ₹789.61 crore in the second quarter of the fiscal, with a decline in provisions and robust growth in core income.
The bank made a net profit of ₹432.38 crore in the second quarter of 2017-18. Its net interest income grew 15 per cent to ₹5,232 crore in the quarter ended September 30, 2018, compared to ₹4,540 crore a year ago.
Net interest margin for the July to September quarter this fiscal stood at 3.36 per cent. Non-interest income for the second quarter grew by a lower 3.6 per cent to ₹2,678.38 crore, against ₹2,585.54 crore during the same period a year ago.
“Growth was restricted mainly due to lower trading profits during the quarter, which declined by 64 per cent to ₹136 crore,” Axis Bank said in a statement.
Total income of the bank grew 15.4 per cent to ₹15,959.37 crore during the second quarter of 2018-19 against ₹13,820.62 crore in the same period of the preceding fiscal.
The bank’s provisions fell 6.78 per cent to ₹2,927.38 crore in the second quarter of the fiscal against ₹3,140.41 crore a year ago.
Its gross non-performing assets (NPAs), as a percentage of gross advances, were stable at 5.96 per cent in the second quarter this fiscal compared to 5.9 per cent a year ago.
“We are continuing to see steady improvement in the overall asset quality environment. All key metrics, whether it is new NPA formation, recoveries, credit costs, NPA ratios, continue to see strong improvement,” said Shikha Sharma, Managing Director and CEO, Axis Bank, adding that the lender believes that the asset-quality cycle has turned, and it should continue trending towards normalisation in the second half of this year.
Slippages declined 69 per cent on year-on-year basis to ₹2,777 crore at the end of the second quarter.
Jairam Sridharan, CFO, Axis Bank, said this was the same as in the third quarter of 2015-16, and the lender expects to contain slippages at less than 1 per cent, going forward.
Management changes
The bank’s board of directors also appointed Amitabh Chaudhry as Managing Director-designate in executive position of the bank from November 19 to December 31, 2018, to ensure a “smooth transition process”.
He will take over as the full-time MD and CEO when Sharma steps down next year.
Meanwhile, the lender also announced that its Deputy MD, V Srinivasan, will retire from the bank at the end of his current tenure of three years on December 20.
Shares of Axis Bank gained 1.26 per cent and closed at ₹ 609.95 apiece on the BSE.
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