Private bank profits rise, thanks to higher NII and low provisions

Witness robust loan growth and higher operating expenses in March quarter

Most private banks that declared their January-March quarter (fourth quarter, or Q4) earnings reported robust growth in net profit, aided by healthy uptick in net interest income (NII) and lower provisions for bad loans as asset quality improved and slippages moderated. 

Banks also saw higher loan growth, which essentially drove their higher NII growth in the quarter.

But margin performance was mixed.

Operating expenses also saw an increase, exerting pressure on pre-provisioning operating profit (PPoP).

Many major private-sector banks, including HDFC Bank, ICICI Bank, Axis Bank, IndusInd Bank, YES Bank, IDFC First Bank, and IDBI Bank, have announced their Q4