HDFC Bank, the country’s second-largest private sector bank, reported a 21 per cent rise in net profit at ₹2,696 crore in the first quarter of this fiscal, driven by healthy loan and interest income growth.

During the quarter, net interest income (interest earned less interest expended) grew 23.5 per cent to ₹6,389 crore, from ₹5,172 crore in the year-ago quarter.

Other income (non-interest revenue) rose to ₹2,462 crore, a 33 per cent increase over the ₹1,850 crore recorded in the same quarter last year.

Operating expenses increased 26 per cent at ₹4,000 crore from ₹3,178 crore during the corresponding quarter of the previous year.

The bank made a loan-loss provision of ₹557.5 crore (₹426.9 crore net of utilisation of floating provisions), and general provision of ₹96 crore (₹63.7 crore).

The cost-to-income ratio for the quarter stood at 45.2 per cent (45.3 per cent in the year-ago period).

NPAs down

Gross non-performing assets (NPAs) were at 0.95 per cent of gross advances, as against 1.07 per cent last year.

Net non-performing assets edged down to 0.27 per cent from 0.32 per cent.

Total restructured loans (including applications under process for restructuring) stood at 0.1 per cent of gross advances against 0.2 per cent in the previous year quarter.

Total deposits as of June 30, 2015, were ₹4.84-lakh crore, a 30 per cent increase over the year-ago figures. Total advances rose 22 per cent year-on-year to ₹3.82-lakh crore.

The domestic loan mix according to Basel II classification between retail and wholesale stood at 53:47.

Saday Sinha, Banking Analyst, Kotak Securities, said, “HDFC Bank’s Q1 FY16 results came largely in line with our expectations. Healthy net interest income growth was aided by strong loan growth (22.4 per cent y-o-y) and stable net interest margin (4.3 per cent).

“However, profit after tax was marginally below our expectations on the back of higher provisions despite robust treasury gains. Last year, the base was low as specific provision was net of utilisation of floating provisions.”

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