Private sector lender Federal Bank reported a 4.3 per cent increase in net profit in the first quarter of the fiscal with robust growth in net interest income as well as higher provisions.

The bank’s net profit amounted to ₹400.77 crore in the quarter ended June 30, against ₹384.21 crore a year ago. Its total income rose 8.6 per cent to ₹3,932.52 crore in the first quarter of the fiscal against ₹3,620.82 crore in the same period a year ago.

Net interest income was the highest ever in a quarter for the bank at ₹1,296 crore, registering a 12.33 per cent year-on-year growth.

Other income grew by 24.74 per cent to ₹488.37 crore in the first quarter of the fiscal versus ₹391.52 crore as on June 30, 2019.

Provisions surged to ₹394.62 crore in the June 2020 quarter from ₹192.04 crore a year ago.

The bank is carrying a specific Covid provision of ₹186 crore as on June 30. Gross non-performing assets stood at ₹3,655.59 crore or 2.96 per cent of gross advances as on June 30, from ₹3,394.69 crore a year ago. Net NPAs as on June 30stood at ₹1,477.46 crore or 1.22 per cent of net advances.

The Provision Coverage Ratio (including technical write-offs) stood at 75.09 per cent.

“It continues to be a challenging environment with recurrence of lockdown in many geographies and challenges of Covid. The bank’s performance has not been dented by this. Butwe have to be,” said Shyam Srinivasan, Managing Director and CEO, Federal Bank. The bank will seek permission at its annual general meeting to raise funds, but Srinivasan said he does not foresee capital raise in the near future.

The book under moratorium has come down with just 24 per cent of the loan book under net moratorium as on July 12.

Total deposits grew 16.9 per cent year-on-year to ₹1,54,937.74 crore, while net advances increased by 8.27 per cent to ₹1,21,296.96 crore as on June 30. Gold loan surged by 36.19 per cent year-on-year to ₹10,243 crore.

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