Bandhan Bank Q3 Results: Net Profit Rises Twofold To Rs 733 Crore On Core Income

Bandhan Bank's total income surged to Rs 5,210 crore during the December quarter, up from Rs 4,840.94 crore in the corresponding period last year

Private sector lender Bandhan Bank announced a surge in its net profit for the third quarter (Q3) ended December 2023, demonstrating a more than twofold increase to Rs 733 crore, buoyed by improvement in core income. In comparison to the year-ago period when it recorded a net profit of Rs 291 crore, as per the bank's latest financial results.

According to regulatory disclosures, Kolkata-headquartered Bandhan Bank's total income surged to Rs 5,210 crore during the December quarter, up from Rs 4,840.94 crore in the corresponding period last year. The interest income mirrored this positive trend, ascending to Rs 4,665 crore from Rs 3,808 crore recorded in the third quarter of the previous fiscal year.

Net interest income also experienced an upward trajectory, reaching Rs 2,530 crore, marking an increase from Rs 2,080 crore reported in the same period of the preceding year.

While the bank showcased improvement in its asset quality, with gross NPAs dropping to 7 per cent compared to 7.2 per cent in the October-December quarter of the prior fiscal year, net NPAs slightly rose to 2.2 per cent from 1.9 percent year-on-year (YoY).

Provision and contingencies nearly halved to Rs 684 crore from Rs 1,541 crore in FY23. However, the capital adequacy ratio witnessed a decline to 17.86 per cent in the December quarter from 19.10 per cent previously.

Chandra Shekhar Ghosh, MD and CEO of Bandhan Bank, highlighted that secured loans accounted for 44.5 per cent of total advances by the end of Q3, aiming to elevate this figure to 50 per cent by 2025-26. He assured that despite tight liquidity, the bank maintained a comfortable position with deposits surpassing advances.

Operating profit for the bank in the third quarter decreased to Rs 1,660 crore from Rs 1,920 crore in the similar previous period, mainly attributed to the absence of a non-recurring item – the sale of an NPA worth Rs 410 crore in Q3 of the last financial year.

Ghosh said the bank's growth momentum across diverse business segments and expressed optimism for its continuity. The net interest margin (NIM) at the end of the third quarter stood at 7.2 per cent, with Ghosh stating the objective of maintaining NIM between 7 per cent and 7.5 per cent by the conclusion of the current fiscal year.

The bank's GNPA improved to 7 per cent while the capital adequacy ratio stood at 19.8 per cent.

During the third quarter, the bank's net interest income surged by 21 per cent to Rs 2,525 crore compared to Rs 2,081 crore in the previous similar period.