IDBI Bank’s first-quarter standalone net profit soared 318 per cent year-on-year (y-o-y) to ₹603 crore on the back of healthy growth in net interest income and other income.
The bank had reported a net profit of ₹144 crore in the year ago quarter.
In the first quarter ended June 30, 2021, net interest income (NII) was up 41 per cent y-o-y to ₹2,506 crore (₹1,772 crore in the year ago quarter).
Other income, comprising income from activities such as commission, fees, earnings from foreign exchange and derivative transactions, profit and loss from the sale of investment and recoveries from written-off accounts, jumped 63 per cent y-o-y to ₹1,639 crore (₹1,005 crore).
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Net interest margin rose to 4.06 per cent from 2.81 per cent in the year ago quarter.
Fresh slippages were lower at ₹1,332 crore (₹2,382 crore in the fourth quarter/Q4 of FY21). The increase in existing non-performing assets (NPAs) was at ₹245 crore (₹250 crore).
Gross NPAs edged up to 22.71 per cent of gross advances as at June-end 2021 against 22.37 per cent as at March-end 2021.
Net NPA position, however, improved to 1.67 per cent of net advances as at June-end 2021, against 1.97 per cent as at March-end, 2021.
Higher provisions towards NPAs
The bank made higher provisions towards NPAs (₹199 crore against a write-back of ₹1,120 crore in Q4FY21) and restructured assets (₹178 crore against ₹9 crore provision). However, provision towards standard assets declined to ₹353 crore (₹708 crore in Q4FY21).
During the reporting quarter, IDBI Bank made an additional provision of ₹447 crore over and above the income recognition and asset classification norms in respect of certain borrower accounts in view of the inherent risk and uncertainty of recovery in these identified accounts.
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Deposits nudged up about 1.37 per cent y-o-y to ₹2,22,381 crore. Advances declined about 2.29 per cent y-o-y to ₹1,22,994 crore.
The bank said it has made provision of ₹902 crore during the quarter ended June 30, 2021, towards the estimated shortfall in recoveries by the Stressed Assets Stabilisation Fund Trust.