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A robust loan demand driven by those for commercial vehicles, and a dip on cost of funds due to a near doubling of its Casa deposits boosted private sector lender IndusInd Bank's net by 25 per cent to Rs 880.10 crore for the three months to September.
The Hinduja Group-promoted bank said its mainstay commercial vehicle loan book grew 25 per cent, helping the overall loan growth to 18 per cent, helping the bank report strong numbers.
Bottomline was also helped by a stable asset quality and lower operational cost coupled with lower cost to income ratio on the back of a savings deposit growth of 95 per cent.
Romesh Sobti, managing director of the bank, said total income rose to Rs 5,395.92 crore from Rs 4,439.72 crore.
Gross non-performing assets marginally rose to 1.08 per cent of the total advances, from 0.90 per cent a year ago, as the bank had to provide for Rs 36 crore for the six of the 28 accounts that RBI had referred to the NCLT for resolution.
Similarly, net NPAs rose to 0.44 per cent from 0.37 per cent in same quarter a year ago. Consequently, the bank made higher provisioning of Rs 294 crore compared to Rs 214 crore in the year-ago quarter.
He said the near doubling of the Casa deposits which helped the bank report a 26 per cent rise in total deposits helped the bank maintain a stable NIM at 4 per cent.
As of end-September, its Casa ratio improved to 42.26 per cent from 36.53 per cent and saving deposit grew 95 per cent to Rs 40,157 crore.
Sobti said the bank has already reached March 2019 target of 40 per cent Casa deposits by now and will review whether it should continue to drive the Casa deposits.
For the quarter, total credit demand picked up 24 per cent, helping it report a 25 per cent increase in net interest income at Rs 1,821 crore while non-interest income rose 22 per cent to Rs 1,187.57 crore and the core fee income jumped 23 per cent to Rs 1,013.02 crore.
The capital adequacy ratio rose to 15.63 per cent.
Total advances rose to Rs 1,23,181 crore from to Rs 98,949 crore, up 24 per cent while total deposits stood at Rs 1,41,441 crore compared to Rs 1,12,313 crore and total business at Rs. 2,64,622 crore.