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Over six months after its reconstruction scheme, private sector lender YES Bank seems to be on a much firmer footing.
For the quarter ended September 30, 2020, the bankreported a net profit of ₹129.37 crore against a net loss of ₹600.08 crore in the same period a year ago. The lender had a net profit of ₹45.44 crore in the first quarter of this fiscal.
“There has been good growth in deposits; we have been careful in advances, and strict control on overheads helped us register a significant improvement in operating profits,” Prashant Kumar, Managing Director and CEO, YES Bank, told reporters on Friday.
Total income falls
For the second quarter of the fiscal, the bank’s total income fell to ₹5,952.14 crore against ₹8,332.20 crore a year ago.
Net interest income was down 9.7 per cent to ₹1,973 crore for the quarter ended September 30, 2020, versus ₹2,186 crore a year ago.
Net interest margin was at 3.1 per cent at the end of the second quarter when compared to 2.7 per cent a year ago and 3 per cent as on June 30, 2020.
Non interest income was down by over 25 per cent on an annual basis to ₹707 crore in the July to September 2020 quarter.
Provisions declined by 11.1 per cent to ₹1,187.33 crore in the second quarter when compared to ₹1,336.25 crore a year ago.
In a statement, YES Bank said its total Covid-related provisioning was now at ₹1,918 crore, amounting to 1.15 per cent of advances.
Gross, net NPAs
Asset quality showed improvement. Gross NPAs amounted to ₹32,344.36 crore or 16.9 per cent of gross advances as on September 30, 2020, from 17.3 per cent in the previous quarter and 7.39 per cent a year ago.
Net NPAs stood at 4.71 per cent of net advances as on September 30, 2020, versus 4.96 per cent as on June 30, 2020.
The bank is now well capitalised with CET I ratio at 13.5 per cent and total CRAR at 19.9 per cent. Its Liquidity Coverage Ratio as on September 30, 2020, was 107.3 per cent.
Kumar said after the initial problems and reconstruction of the bank, it has continuously met all the required regulatory ratios in terms of liquidity and capital. YES Bank has also returned the entire ₹50,000-crore special liquidity facility to the RBI.
The bank’s focus on deposit mobilisation also continued, with a 15.7 per cent increase sequentially in deposits to ₹1.35-lakh crore at the end of the second quarter this fiscal. This was also a 28.9 per cent increase over a six month period.
However, its deposits are yet to reach the levels of September 30, 2019, when it amounted to ₹2,09,497 crore.
Growth in net advances was, however, conservative with just a 1.5 per cent increase quarter-on-quarter to ₹1.66-lakh crore. It was also significantly lower than ₹2,09,497 crore a year ago.
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