Housing Finance Development Corporation Ltd posted flat growth in net profit at Rs 3,001 crore in the first quarter ended June 2021 (Q1 FY22), said the mortgage major on Monday.
The company had reported net profit of Rs 3,051 crore in the same quarter last year (Q1Fy21). A company statement said the profit numbers for Q1Fy22 are not directly comparable with that of the previous year for several reasons, including higher effective tax rate of 23.1 per cent this year as against 15.4 per cent last year.
Net interest income (NII) in the reporting quarter rose by 22 per cent to Rs 4,147 crore compared to Rs 3,392 crore in Q1Fy21. The overall collection efficiency ratio for individual loans has improved since June 21 to pre-COVID levels. It stood at 98.3 per cent in June 2021 compared to 98 per cent in March 2021.
Despite business disruptions caused by the second wave of Covid-19, the growth in the individual loan book, after adding back loans sold in the preceding 12 months, was 22 per cent. The growth in the total loan book after adding back loans sold was 12 per cent.
Assets under management (AUM) rose to Rs 5.74 trillion at the end of June 2021 compared to Rs 5.31 trillion a year ago.
Individual loan disbursements grew 181 per cent in Q1Fy22 over Q1Fy21.The growth was seen in both, the affordable housing segment and high end properties. The demand for home loans continues to remain strong and disbursements have picked up with the unlocking of respective locations.
While disbursements during April and May 2021 were somewhat impacted, business has reverted to normalised trends in the months of June and July. Infact, disbursements in July 2021 were the highest ever in a non-quarter end month, it added.
Individual Non-performing assets increased on account of the impact of the second wave of the pandemic. Collection efforts were hindered due to the recovery teams being unable to do field visits during the lockdown period. The gross non-performing loans stood at Rs 11,120 crore. This is equivalent to 2.24% of the loan portfolio.
Further, various court orders temporarily curbing recovery efforts of financial institutions, including refraining possession activities under SARFAESI hampered the collection efforts.
As per regulatory norms, the Corporation is required to carry a total provision of Rs 5,778 crore. Of this, Rs 2,443 crore is towards provisioning for standard assets and Rs 3,335 crore is towards non-performing assets.
The Corporation’s Expected Credit Loss charged to P&L the in Q1Fy22 was Rs 686 crore as against Rs 1,199 crore in Q1Fy21.
The loans restructured under the RBI’s Resolution Framework for COVID-19 Related Stress stood at Rs 4,482 crore. This is equivalent to 0.9 per cent of the loan book. Of the loans restructured, 38 per cent are individual loans and 62 per cent non-individual loans.
The Corporation’s capital adequacy ratio stood at 22.0 per cent, with Tier I capital of 21.3 percent and Tier II capital was 0.7 per cent at end of June 2021.
Dear Reader,
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.
Digital Editor
RECOMMENDED FOR YOU