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Riding on the back of higher provisioning on standard assets, Bandhan Bank posted a 32 per cent drop in net profit at ₹550 crore for the quarter ended June 30, 2020, against ₹804 crore in the corresponding period last year.
In Q1 FY21, the bank has taken accelerated additional provision on standard assets amounting to ₹750 crore for Covid-19. The bank, which had posted a net profit of close to ₹517 crore in the fourth quarter of last fiscal, had made a provision of ₹690 crore against the potential impact of the pandemic.
After making an aggregate additional provisions of ₹1,440 crore in the two quarters, the bank also carried additional standard asset provision on micro finance portfolio at 0.75 per cent, amounting to ₹329 crore.
“With this provision and additional standard assets provision that bank is carrying in micro banking portfolio, the total additional provision in books stands at Rs 1,769 crore,” said a press release issued by the bank.
GNPA falls
The gross non-performing assets (GNPA) came down to 1.43 per cent against 1.70 per cent same period last year, while the net NPA decreased to 0.48 per cent when compared to 0.59 per cent last year.
Net interest income (NII) for the quarter grew by close to 15 per cent to ₹1,811 crore against ₹1,575 crore in the corresponding period last year.
Operating profit for the quarter increased by 17 per cent to ₹1,584 crore (₹1,356 crore).
The bank’s total advances grew by 18 per cent to ₹74,331 crore as on June 30, 2020, against ₹63,164 crore in the same period last year, while deposits increased by 35 per cent to ₹60,610 crore (₹44,796 crore).
According to Chandra Shekhar Ghosh, Managing Director and CEO, Bandhan Bank, overall collections improved to 76 per cent by end of June when compared to 29 per cent in April.
“We continued to showcase the strengths of our retail deposit franchise with strong growth of 35 per cent during this difficult time, especially CASA growing by over 47 per cent,” he pointed out.
The bank’s scrip fell by 0.78 per cent to close at ₹349.65 on the Bombay Stock Exchange on Wednesday.
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