MUMBAI: HDFC Bank on Saturday reported a 5% rise in net income year-on-year to Rs 16,821 crore, despite overall stressed assets inching up marginally. The numbers beat Street expectations as brokerages were expecting the largest private sector lender to post Rs 16,570 crore in net income in the September quarter.
The bank posted better-than-expected net interest income. Net interest income rose 10% to Rs 30,114 crore as against brokerages expectations of Rs 30,306 crore.
The core profitability gauge, net interest margin, printed in at 3.46% and 3.65% based on interest earning assets, chief financial officer Srinivasan Kothandaraman Vaidyanathan told reporters in an earnings call Saturday. Other income for the quarter came in at Rs 11,480 crore compared to Rs 10,710 crore year-ago period.
Gross non-performing assets stood at 1.36%, marginally higher than 1.33% in the preceding quarter, while net NPAs stood at 0.41%, up from 0.39% quarter-on-quarter.
In absolute terms, gross NPAs rose to Rs 34,251 crore from Rs 33,026 crore, while net NPAs climbed to Rs 10,309 crore from Rs 9,508 crore quarter-on-quarter. Provisions for the quarter rose to Rs 2,701 crore, rising 4 percent from Rs 2,602 on-quarter, Vaidyanathan said.
In the reporting quarter, gross advances rose 7% to Rs 25.19 lakh crore, and the CFO refused to offer guidance on any key numbers but said “we are focused growth at any cost but only quality growth. Asset quality is the core driver behind our growth.”
Retail loans grew 11.3%, and commercial and corporate books clipped at 17.4%, he said, adding that corporate and other wholesale loans were lower by 12%. In fact, wholesale book degrew 2% and Vaidyanathan attributed the same to price mismatches. Overseas advances constituted 1.7% of the total advances of the nation’s second largest lender with a balance sheet of over Rs 30 lakh crore.
Advances on an average basis were Rs 25.64 lakh crore in the quarter as against Rs 23.27 lakh crore a year ago, and Rs 25.33 trillion in the previous quarter. Total deposits grew 15.1% YoY to Rs 25.08 lakh crore for the first time crossing the Rs 25 lakh crore mark, he said. Of the total liabilities, current and savings account fetched 8.1% more funds, with savings at Rs 6.08 trillion and current account deposits at Rs 2.75 lakh crore.