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Private sector lender Bandhan Bank posted a 10.3 per cent increase in net profit in the third quarter of the fiscal despite making a provision of ₹385 crore for exposure to troubled IL&FS.
The bank’s net profit amounted to ₹331.26 crore for the quarter ended December 31, 2018, compared to ₹300.04 crore during the third quarter of 2017-18. However, on a sequential basis, the net profit was lower compared to ₹487.65 crore in the July to September 2018 quarter.
“Despite the provision for one large infrastructure account, we have had 10.3 per cent growth. Excluding its impact, growth in net profit would be 93 per cent,” said Chandra Shekhar Ghosh, Managing Director and CEO, Bandhan Bank.
Total income of the bank rose by 41 per cent to ₹1,883.65 crore in the third quarter of the fiscal against ₹1,336.42 crore year ago.
Net interest income for the quarter grew by 53.5 per cent at ₹1,124 crore, against ₹732 crore in the corresponding quarter of the previous year. Non-interest income grew by 48.1 per cent at ₹234 crore for the quarter ended December 31, 2018, against ₹158 crore in the same period a year ago.
Net interest margin for the quarter stood at 10.3 per cent, against 9.9 per cent in the corresponding quarter of the previous year, and 9.7 per cent in 2017-18.
For the third quarter, the lender’s total provisions shot up by 208 per cent to ₹377.64 crore, compared to ₹122.54 crore a year ago.
Of this, the bank made 100 per cent provision for exposure to IL&FS in this quarter. “Provision and contingencies for the quarter December 31, 2018, includes provision of ₹384.95 crore made on prudent basis, in respect of an exposure to a borrower from the infrastructure development and finance sector, which was classified as non-performing asset and fully provided for during the quarter,” the lender said in a regulatory filing, adding that the profit before tax for the quarter is lower to that extent.
The bank’s gross non-performing loans as on December 31, 2018, stood at 2.4 per cent, against 1.3 per cent as on September 30, 2018, and 1.7 per cent as on December 31, 2017.
Net NPAs were flat at 0.7 per cent as on December 31, 2018, against 0.7 per cent as on September 30, 2018, and 0.8 per cent as on December 31, 2017.
Shares of Bandhan Bank gained 3.82 per cent on Thursday and closed at ₹471.70 apiece on the BSE.
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