HDFC Bank on Saturday reported a 0.85 per cent sequential rise in net profits for the quarter ended March 31. The country’s largest lender posted a net profit of Rs 16,511.85 crore compared with Rs 16,372.54 crore in the December quarter.
The year-on-year (over March 31, 2023) net profit numbers are not comparable as HDFC Bank had completed its merger with HDFC in July 2023.
Analysts polled by Bloomberg had forecast HDFC Bank to report a net profit of Rs 17,593 crore for the January-March quarter.
The marginal rise in net profits over the preceding three months came as provisions jumped. It grew to Rs 13,511.64 crore against Rs 4,216.64 crore in the October-December 2023 period. The increase came as the bank made floating provisions of
Rs 10,900 crore in the quarter.
At a press conference, senior officials of the bank explained that the floating provision has not been made because they expect any increase in bad loans. The asset quality of the bank remains healthy across the board, they added.
HDFC Bank said the credit environment in the economy remains benign and its credit performance across all segments continues to remain healthy.
A press statement disclosed that its gross non-performing asset (GNPA) ratio at 1.24 per cent (1.26 per cent in the previous three months) has shown an improvement.
“The bank has considered this as an opportune stage to enhance its floating provisions, which are not specific to any portfolio, but act as a countercyclical buffer for making the balance sheet more resilient, and these also qualify as Tier 2 Capital within the regulatory limits,’’ it added.
The quarter was also marked by a one-time gain of Rs 7,341.42 crore as it sold a large stake HDFC Credila to BPA EQT and ChrysCapital. HDFC Credila is no longer a subsidiary of HDFC Bank.
During the quarter, the lender’s core net interest income (NII-interest earned minus interest paid) rose to Rs 29,080 crore against Rs 28,470 crore in the previous three months.
Meanwhile, the bank is also planning to list HDB Financial Services, which is classified as an upper layer non-banking finance company by the RBI.
