HDFC Bank September Quarter Profit Jumps 18%, Asset Quality Improves
HDFC Bank's net interest income rose 16.73% in the July-September period
HDFC Bank said its total income increased 6.86 per cent to Rs 36,069.42 crore in the second quarter of current financial year, from Rs 33,755 crore in the year-ago period.
Net interest income - or the difference between interest earned and interest expended - came in at Rs 15,776.39 crore, up 16.73 per cent compared to Rs 13,515.04 crore in the year-ago period.
The bank's board approved the appointment of Sashidhar Jagdishan as managing director and CEO for a period of three years starting October 27.
The coronavirus pandemic and related restrictions have led to changes in customer behaviour, and impacted business and individual activities, causing significant volatility in global and domestic financial markets, the bank said in a statement.
Mumbai-based HDFC Bank's net interest margin - a key measure of profitability - came in at 4.1 per cent as against 4.3 per cent in the previous quarter.
HDFC Bank said that while there has been some improvement in economic activities during the current quarter, the continued slowdown has led to a decrease in loan originations, the sale of third-party products, the use of credit and debit cards by customers, and the efficiency in collection efforts.
However, its net non-performing assets - or net bad loans - more than halved to Rs 1,756.08 crore in the fiscal second quarter, compared to Rs 3,790.95 crore a year ago.
Gross non-performing assets as a percentage of total loans reduced to 1.08 per cent in the July-September period, from 1.36 per cent in the previous quarter, and 1.38 per cent in the second quarter of financial year 2019-20.
HDFC Bank said it continues to hold provisions against the potential impact of COVID-19 in excess of RBI-prescribed norms.
The lender said its continued focus on deposits helped it maintain a healthy liquidity coverage ratio of 153 per cent, well above the regulatory requirement. Its total deposits rose 20.33 per cent to Rs 12,29,310 crore, and loans 15.76 per cent to Rs 10,38,335 crore.