HDFC Bank, India's largest private lender by market capitalisation, on Saturday posted lower-than-expected net profit due to mark-to-market loss.
It reported an 18.17 per cent year-on-year (YoY) growth in net profit at Rs 4,601.44 crore for the quarter ended June. The figure was Rs 3,893.84 crore in the same quarter last year.
An earlier ETNow poll had pegged net profit at Rs 4,710 crore.
The growth in profit turned out to be the slowest in six quarters.
“The bank has recognised the entire mark to market loss of Rs 391 crore in the current quarter ended June 30, 2018. The loss was primarily attributable to the corporate bond portfolio,” HDFC Bank said in a release.
Net interest income (NII) — the core income from operations — jumped 15.40 per cent to Rs 10,813.57 crore in Q1 FY19, from Rs 9,370.74 crore a year earlier.
Below are five key takeaways from HDFC Banks Q1 numbers:
Advances: The lender reported 22 per cent YoY jump in total advances to Rs 7.08 lakh crore for the April-June 2018. This loan growth was contributed by both segments of the bank's loan portfolio, with the domestic loan mix of retail and wholesale at 55:45. Retail loans grew 21.6 per cent and wholesale loans climbed 22.7 per cent during the quarter under review.
Deposits: Total deposits as of June 30 were Rs 8.06 lakh crore, up 20 per cent from last year.
Asset quality: HDFC Banks asset quality remained stable on a sequential basis. Gross bad loans came in at 1.33 per cent of total advances for the quarter under review as against 1.30 per cent in January-March. Net bad loans were 0.41 per cent compared with 0.40 per cent in the March quarter. Gross non-performing assets (NPAs) in absolute terms went up to Rs 9,538.62 crore during the three months to June against Rs 8,606.97 crore in the preceding quarter.
Provisions: Provisions and contingencies increased 4.52 per cent to Rs 1,629.37 crore in Q1 FY19, from Rs 1,558.76 crore in the same period last year. The figure for the quarter to March stood at Rs 1,541.10 crore.
Capital adequacy ratio: The banks total capital adequacy ratio (CAR) as per Basel III guidelines was at 14.6 per cent against 15.6 per cent as June-end 2017 and regulatory requirement of 11.025 per cent.