HDFC Bank PBT up 5.15% in April-June; provisions increase by 49%

Net profit for reporting quarter rises by 19.6 per cent to Rs 6,658.62 crore from net profit of Rs 5,568.16 crore in Q1FY20

Private sector lender HDFC Bank has posted a 5.15 per cent rise in profit before tax (PBT) at Rs 8,973.8 crore for the first quarter ended June 2020 (Q1FY21). It had posted a PBT of Rs 8,533.6 crore in quarter ended June 2019 (Q1FY20).

Its net profit for reporting quarter rose by 19.6 per cent to Rs 6,658.62 crore from net profit of Rs 5,568.16 crore in Q1FY20.

The Net Interest Income (NII) grew by 17.8 per cent on a Year-on-Year basis from Rs 13,294.3 crore in Q1FY20 to Rs 15,665.4 crore in Q1FY21, driven by 20.0 per cent growth in advances and 24.6 per cent rise in deposits.

The other income comprising fees, commissions etc declined by 18 per cent from Rs 4,970.3 crore in Q1FY20 to Rs 4,075.3 crore in Q1FY21. The continued slowdown in economic activity has led to a decrease in retail loan origination, sale of third party products, the use of credit and debit cards by customers, efficiency in collection efforts and waivers of certain fees, bank said.

The provisions (including for NPAs) and contingencies by 48.9 per cent to Rs 3,891.5 crore in Q1FY21 from Rs 2,613.7 crore in Q1FY20. The specific loan loss provisions stood at Rs 2,739.8 crore in Q1FY21 as against Rs 2,248.0 crore in June quarter last year. The general provisions and other provisions rose multi-fold to Rs 1,151.7 crore in Q1FY21 from Rs 365.7 crore in Q1FY20.

The bank said it has used its analytical models to determine slippages, resulting in a more expedited recognition of NPAs, and accelerated corresponding specific provisions. The Bank also continues to hold provisions against the potential impact of Covid-19 based on the information available at this point in time.

These provisions are in excess of the norms prescribed by Reserve Bank of India.

The gross non-performing Assets (GNPAs) declined to 1.36 per cent in Q1FY21 from 1.4 per cent in Q1FY20. The GNPA were at 1.26 per cent at end of March 2020.

The net NPAs declined to 0.33 per cent in June 2020 from 0.43 per cent in June 2019. The Net NPAs were at 0.36 per cent in Mach 2020.

The total deposits rose by 24.6 per cent at Rs  11,89,387 crore and advances grew by 20.9 per cent Y-O-Y to reach Rs 10,03,299 crore as on June 30, 2020.

The Capital Adequacy Ratio (CAR) stood at 18.9 per cent as on June 30, 2020 with Tier I at 17.5 per cent.