Housing finance major HDFC on Thursday reported a 20 per cent growth in standalone net profit to Rs4,425 crore for the quarter ending March 2023 on the back of higher interest income.

The bank’s profit in the January-March quarter of 2021-22 was Rs 3,700 crore.

In a filing to stock exchanges, HDFC said there was an 18per cent growth in the standalone profit after tax for the year ended March 31, 2023, at Rs 16,239 crore compared with Rs 13,742.18 crore in 2021-22.

Assets under management stood at over Rs 7.2 lakh crore.

Its vice-chairman and chief executive Keki Mistry said the company expects the$40 billion merger with HDFC Bank to be completed by July this year.

In the reporting quarter, its core net interest income grew 16 per cent to Rs 5,321 crore on the back of an expansion in the net interest margin to 3.7 per cent and a 24 per cent growth in individual loans.

Mistry said NII has been impacted because of the RBI’srate hikes, wherein the cost of liabilities rose faster compared with the yield on advances resulting in an impact on interest incomes.

On a call with analysts, Mistry said that the company is carrying an excess statutory liquidity ratio, with the overall investments in government securities being 128 per cent of the requirements. It can be noted that the excess investments will come in handy for the merger, which will increase the investment requirements.

He said the merger – the largest in India’s corporate history - will be completed by July based on the current progress. Replying to a question on the way forward for warranty holders after their expiry in August, Mistry said the holders will get shares of HDFC Bank instead of HDFC in the same proportion as the merger ratio.

HDFC will engage with RBI to find a better-suited way out on its fully-owned educational loans subsidiary Credila Financial Services, Mistry said, adding that a variety of people have approached it evincing interest to invest.

A final solution on Credila will be out by June, Mistry said.

The board of directors has declared an interim dividend for 2022-23 of Rs 44 per equity share of face value of Rs 2 each compared with a final dividend of Rs 30 per equity share a year ago.