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Retail loan growth and lower provisioning helped Axis Bank report a 22 per cent increase in net profit at Rs 1,347 crore in the October-December quarter.
The private sector lender had posted a net profit of Rs 1,102 crore in the year-ago period.
Net interest income (NII) during the quarter was up 17 per cent to Rs 2,495 crore (from Rs 2,140 crore in Q3 FY12). ‘Other income’, led by fee and trading income growth, rose by 13 per cent to Rs 1,620 crore (Rs 1,430 crore in Q3 FY12).
During the quarter, net provisions and contingencies were lower by about 8 per cent to Rs 387 crore against Rs 422 crore in the year-ago period. Sequentially also, net provisions and contingencies declined by 24 per cent.
“We have provided for quite prudently,” said Somnath Sengupta , Executive Director, Axis Bank.
However, net interest margin (NIM) declined to 3.57 per cent from 3.75 per cent in Q3 FY12. Net advances during the quarter grew by 21 per cent. Retail assets increased by 45 per cent year-on-year and account for 27 per cent of net advances
“It is a conscious decision to pursue retail loan growth…We will continue to see growth, especially in the home loans, loan against property and personal loan segments,” Sengupta said.
NPA
Gross non-performing assets (NPAs) remained unchanged from the corresponding year-ago quarter at 1.10 per cent, while net NPAs dropped to 0.33 per cent from 0.39 per cent for the same quarter last year.
Recoveries and upgradations during the quarter stood at Rs 180 crore.
On the financially-troubled Deccan Chronicle Holdings Ltd, Sengupta said the bank had already booked the account as an NPA in the previous quarter.
Recoveries have been slower than the previous quarter, but coming up, he added.
Restructured loans
The bank’s restructured assets portfolio increased by Rs 368 crore during the quarter and stood at Rs 4,257 crore as on December 31, 2012. The restructured book in the April-December period stood at Rs 1,320 crore.
At the day’s close, shares of Axis Bank ended at Rs 1,422.45 per share, up 2.64 per cent on the Bombay Stock Exchange.
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