Private sector lender Axis Bank bounced back with a robust 131 per cent increase in its net profit in the third quarter this fiscal with a strong growth in advances and improvement in asset quality.
The bank’s net profit more than doubled to ₹1,681 crore in the October to December 2018 quarter, compared to ₹726.44 crore in the same period a year ago. It had posted its first-ever quarterly loss in the fourth quarter of 2017-18 at ₹2,188.74 crore, but has been on a recovery path this fiscal.
Its total income grew by 26.6 per cent to ₹18,130.42 crore in the quarter ended December 31, 2018, compared to ₹14,314.63 crore in the same period a year ago.
“Net interest margin for the third quarter this fiscal was 3.47 per cent, up from 3.36 per cent in the second quarter,” the bank said in a statement on Tuesday.
Its net interest income grew 18 per cent to ₹ 5,604 crore during the third quarter of this fiscal, from ₹ 4,732 crore in the same period a year ago.
Non-interest income for the quarter under review grew 54 per cent to ₹4,001 crore, against ₹2,593 crore during the same period last fiscal.
“The bank has faced some headwinds, especially on the asset quality front, driven by corporate slippages. Financial performance, too, has moderated and corporate loans have grown below our long-term growth rates. An increase in our operational risks has not helped the cause either,” said Axis Bank MD and CEO Amitabh Chaudhry, adding the lender will focus on growth, profitability and sustainability over the next three years.
Provisions grew by 8.66 per cent to ₹3,054.51 crore in the third quarter this fiscal against ₹2,811.04 crore a year ago.
Axis Bank said it recovered ₹998 crore this quarter, largely comprising two accounts from the prudentially written-off pool, compared to ₹40 crore in the same period a year ago. Recoveries and upgrades from NPAs during the quarter were ₹1,622 crore, while write-offs were ₹2,207 crore.
Axis Bank also said it has received an indicative list from the RBI that related to asset quality divergence for 2017-18.
The lender’s scrip gained 0.74 per cent and closed at ₹660.80 on the BSE.