RBL Bank’s net profit soared about 6.50 times to ₹202 crore in the second quarter against ₹31 crore in the year-ago quarter, helped by sharp decline in provisions and rise in net interest income (NII).

NII (difference between interest earned and interest expended) was up 16 per cent year-on-year (YoY) at ₹1,064 crore (₹915 crore).

Total non-interest income, comprising fee-based income, trading income and other income, declined marginally to ₹583 crore (₹593 crore).

Operating profit before provisions and contingencies declined 26 per cent YoY to ₹512 crore (₹691 crore).

Provisions (other than tax) were sharply lower by 63 per cent at ₹241 crore (₹651 crore).

Net Interest Margin improved to 4.55 per cent from 4.36 per cent in the preceding quarter and 4.06 per cent in the year ago period.

Gaining momentum

R Subramaniakumar, MD&CEO, RBL Bank said “The advances growth is starting to gain momentum and we expect to see this continue. The bank expects to end FY23 with advances growth of 15 per cent.”

The Bank will be entering three new lines of business - loans for two-wheelers and used cars and gold loans - in the current quarter. It will be introducing education loans, loans against property and specialised MSME loans in the following quarter.

Net advances grew 12 per cent YoY to ₹62,942 crore. Deposits were up 5 per cent YoY to ₹79,404 crore.

Gross NPA position improved to 3.80 per cent of gross advances as of September-end 2022 against 4.08 per cent as of June-end 2022. Net NPAs position, however, slipped a share to 1.26 per cent of net advances against 1.16 per cent.

Subramaniakumar observed that granular deposit growth is picking up momentum and asset quality continues to be stable, with GNPA also trending down over earlier periods.

“Going forward our focus would be to consolidate, leverage and optimize our existing platform to accelerate the profitable growth of the balance sheet.

“We will continue to focus on our key niche areas of cards and microfinance while accelerating the diversification across more secured retail products by launching them in the next few months,” he said.