Private sector lender RBL Bank on Saturday reported a 37% year-on-year (y-o-y) and 30% quarter-on-quarter (q-o-q) rise in its Q4FY23 net profit at Rs 271 crore, led by stable advances, other income growth and lower provisions. The bottomline was higher than Bloomberg estimate of Rs 262 crore for Q4FY23.
For the quarter ended March, the bank’s other income, which consists of commission income from non-fund-based activities, fees from third-party services, treasury income, among others, rose to Rs 674 crore, up 32% YoY. The bank’s net interest income—difference between interest earned and expended—grew 7% y-o-y to Rs 1,211 crore during Q4. Net interest margin (NIM), meanwhile, moderated slightly to 5.01% in Q4FY23 from 5.04% the previous fiscal. Separately, the bank’s board has recommended a dividend of Rs 1.50 per equity share of Rs 10 each, subject to shareholder approval.
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Advances grew at 17% y-o-y during Q4 to stand at Rs 70,209 crore as on March end. Retail loans accounted for 54% of total advances and wholesale loans 46%. Credit card loans, the biggest segment of the bank’s retail loan portfolio, grew 24% y-o-y to Rs 16,594 crore in Q4. In total, the bank added 550,000 credit cards in Q4FY23 taking the total cards outstanding figure to 4.4 million.
In FY23, the bank introduced new retail asset products like gold loan, working capital or term loan for micro, small and medium enterprises (MSME), and vehicle loans. “New initiatives undertaken in FY23 on new secured product launches, and scale up of granular retail products are also starting to bear fruit. With the scale-up of these products and introduction of new products (both digital and branch based) in the coming year, we expect growth to become more broad based,” said R Subramaniakumar, managing director and chief executive officer (MD & CEO) at RBL Bank.
RBL Bank’s deposits grew 7% y-o-y to Rs 84,887 crore as on March 31. The bank’s low-cost current and savings account ratio (CASA) improved to 37.4% during Q4FY23 from 35.3% a year ago.
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Further, the bank’s asset quality improved during the reporting quarter, with gross and net non-performing asset ratio (GNPA/NNPA) falling to 3.37% and 1.10% as on March 31, from 4.40% and 1.34% in the corresponding period a year ago, respectively.
As asset quality improved, the bank’s total provisions fell to Rs 235 crore during the reporting quarter, lower than Rs 401 crore the previous fiscal. Provision coverage ratio was at 68.1% as on March 31, lower than 70.4% the previous year. Lastly, the lender’s total capital adequacy ratio was at 16.9% as on March end, of which tier-I capital stood at 15.3%.