Other income pushes Yes Bank net up 26.5%; bad loans double

Yes Bank today reported a 26.5 per cent rise in net profit at Rs 610.4 crore for the second quarter ended September 30, boosted by fee income, which helped it offset the impact of rising bad loans that more than doubled in the reporting period.
The city-based private sector lender also said it will be launching an asset management business for which approvals are pending with the central bank.
The net NPAs during the quarter more than doubled to 0.20 per cent from 0.09 per cent in the year-ago period. Its gross NPAs jumped to 0.61 per cent from 0.36 per cent.

The total standard restructured advances stood at Rs 569.3 crore as of September 30, representing 0.71 per cent of the gross advances, which was same as last quarter.
The bank added Rs 52 crore in fresh bad loans, its managing director and chief executive Rana Kapoor told reporters and attributed the spike to troubles in the steel sector to which it has an exposure of 3.8 per cent of its total assets.
The good set of numbers come in spite of a flat net interest margin which stood at 3.3 per cent quarter-on-quarter but 10 bps up year-on-year, and Kapoor expressed hope that going forward the bank will be able to better the same by 20 bps on the back a 100 bps reduction in its savings deposit rates.

The total income of the bank increased to Rs 3,995.34 crore from Rs 3,337.97 crore, while the core net interest income was Rs 1,108.5 crore, up 29.4 per cent.

Its non-interest income moved up 22.2 per cent to Rs 618.1 crore.
The mid-sized bank, which has around 700 branches, is focusing on low-cost Casa deposits which during the quarter rose 40.5 per cent, helping the bank for the first time take savings deposits base to 25.5 per cent from 22.5 per cent a year ago.
Its advance grew 29 per cent to Rs 80,015.1 crore but on a sequential basis, it just inched up 0.4 per cent. Deposits rose 24 per cent to Rs 99,344.3 crore year-on-year, and just 4.2 per cent quarter-on-quarter.

Kapoor said the bank has not sold any bad assets to ARCs in the past four quarters nor has it restructured any stressed asset under the 5/25 scheme so far but if the situation arises, the bank is open to it. Similarly, there was also no write-offs during the quarter.
On fund raising, he said the bank will tap USD 1 billion worth of foreign fund window it has from the board, in 2016.