HDFC Bank, the country’s largest private sector lender, on Saturday reported a standalone net profit of Rs 10,055.18 crore for the March 2022 quarter, a jump of 22.82 per cent as compared with Rs 8,186.51 crore a year ago. Its total income during January-March 2022 rose eight per cent to Rs 41,085.78 crore, against Rs 38,017.50 in the year-ago period.
Its net interest income (NII), interest earned minus interest expended, for the March 2022 quarter grew 10.2 per cent to Rs 18,872.7 crore, compared with Rs 17,120.2 crore a year ago, according to a BSE filing.
The bank’s core net interest margin stood at four per cent on total assets and 4.2 per cent based on interest earning assets, it said.
Other income (non-interest revenue) was at Rs 7,637.1 crore, which was 28.8 per cent of lender’s total net revenues for the quarter, compared with Rs 7,593.9 in the March 2021 quarter.
The bank’s operating expenses for the March 2022 quarter stood at Rs 10,152.8 crore, an increase of 10.6 per cent over Rs 9,181.3 crore during the corresponding quarter of the previous year. Its cost-to-income ratio for the quarter stood at 38.3 per cent.
Pre-provision operating profit (PPOP) during the March 2022 quarter stood at Rs 16,357 crore. PPOP, excluding trading income, grew 10.2 per cent over the quarter ended March 31, 2021.
On the asset quality front, the bank on Saturday reported gross non-performing assets (GNPA) at 1.17 per cent of gross advances as on March 31, 2022, compared with 1.31 per cent a year ago. The GNPAs during the December 2021 quarter stood at 1.26 per cent. In absolute terms, the bank’s GNPAs increased to Rs 16,140.96 crore as compared with Rs 15,086 crore a year ago.
Its net NPAs, or bad loans, stood at 0.32 per cent of net advances at the end of the March 2022 quarter as compared with 0.40 per cent a year ago. In absolute terms, it stood at Rs 4,407.68 crore against Rs 4,554.82 crore a year ago. “Liquidity coverage ratio was healthy at 112 per cent, well above the regulatory requirement,” HDFC Bank said in a statement.
Its provisions and contingencies for the quarter ended March 31, 2022, stood at Rs 3,312.4 crore (consisting of specific loan loss provisions of Rs 1,778.2 crore and general and other provisions of Rs 1,534.2 crore) as against total provisions of Rs 4,693.7 crore for the quarter ended March 31, 2021. Total provisions for the current quarter included contingent provisions of about Rs 1,000 crore.
The bank’s total deposits as on March 31, 2022, stood at Rs 15,59,217 crore, a jump of 16.8 per cent as compared with the previous year. CASA (current account-saving account) deposits rose 22 per cent with savings account deposits at Rs 5,11,739 crore and current account deposits at Rs 2,39,311 crore.
Its total advances jumped 20.8 per cent year-on-year to Rs 13,68,821 crore during the March 2022 quarter. Retail loans jumped 15.2 per cent, commercial and rural banking loans grew 30.4 per cent and corporate and other wholesale loans grew by 17.4 per cent. Overseas advances constituted 3.1 per cent of the total advances, the bank said in the statement.
“The lender’s total capital adequacy ratio (CAR) as per Basel III stood at 18.9 per cent as on March 31, 2022, against the regulatory requirement of 11.7 per cent. It had stood at 18.8 per cent as on the March 31, 2021. Tier 1 CAR was at 17.9 per cent as of March 31, 2022, compared with 17.6 per cent as on March 31, 2021,” it said.
Its Common Equity Tier 1 capital ratio was at 16.7 per cent as of March 31, 2022. Risk-weighted assets were at Rs 13,53,511 crore against Rs 11,31,144 crore as at March 31, 2021.
The bank added 563 branches and 7,167 employees during the March 2022 quarter and 734 branches and 21,486 employees during the year 2021-22, according to the statement.
For the full financial year 2021-22, HDFC Bank’s net profit stood at Rs 36,961.33 crore as compared with Rs 31,116.53 crore in the previous year.
HDFC Bank is the first lender to declare its financial results during the current earnings season.
Q4 Results: Earnings Expectations On Banking Sector
On the banking sector’s Q4 performance, India Ratings and Research Director Karan Gupta told News18.com, “On asset quality and collections, 4Q should see banks doing good on this and further with loan growth expected to show an uptick, GNPA numbers should look better. Movement in asset quality of the restructured and ECLGS portfolios is a key monitorable though. On NIM, not much to talk about as some banks have raised deposit rates marginally, which would also be reflected in higher lending rates.”
Gupta added that in terms of other key monitorables, there should be an impact on slippages as banks continue to increase provision against a large corporate account that has slipped during the quarter.
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