RBL Bank posted a net profit of ₹294 crore for Q2 FY24, up 46 per cent y-o-y and 2 per cent sequentially.

During the quarter, the bank saw write-back of tax provisions worth ₹222.92 crore, which the bank has used to create contingent provisions in its microfinance and credit card segments at 1 per cent of the total advances, amounting to ₹252 crore.

The bank also modifying its provisioning policy in credit cards to provide fully on NPA cases at 120 days as against the existing policy of 180 days, which led to additional provisions of Rs 48 crore.

Credit cost for the quarter was 47 bps. The figure is 43 bps higher if the contingency buffer and accelerated provisions are taken into account.

In the post earnings call, MD and CEO R. Subramaniakumar said that the bank continues to maintain the FY24 credit cost estimate of 1.5-2 per cent. The buffers were created to fortify the balance sheet and that the bank does not see any asset quality concerns in the unsecured or retail portfolios, which will continue to grow at the same pace, he said.

Gross NPA ratio improved to 3.12 per cent from 3.22 per cent a quarter ago and 3.80 per cent a year ago. Net NPA ratio at 0.78 per cent was also better than 1.00 per cent in the previous quarter and 1.26 per cent in the previous year.

The bank also said it is making good progress on cross sell opportunities within its card and liability base, and is expected to accelerate further going forward.

Net advances grew 21 per cent yoy and 4 per cent qoq to ₹76,324 crore. Retail loans were 35 per cent yoy and 8 per cent qoq to ₹44,092 crore, accounting for 58 per cent of total loans.

Net Interest Income (NII) grew 26 per cent yoy and 4 per cent qoq to ₹1,475 crore. NIM for the quarter was 5.54 per cent as against 5.02 per cent a year ago.

Total deposits grew 13 per cent yoy and 5 per cent qoq to ₹89,780 crore. Retail deposits were up 19 per cent yoy and 4 per cent qoq to ₹39,706 crore. CASA ratio fell to 35.7 per cent from 36.2 per cent a year ago.

Published on October 21, 2023