Private sector lender Federal Bank's second quarter (July-September) earnings beat analysts’ expectations on Monday as profit for the quarter grew by 31.1 percent year-on-year to Rs 263.7 crore. The growth was driven by higher net interest income and operating profit.
Profit in year-ago quarter stood at Rs 201.2 crore.
Net interest income, the difference between interest earned and interest expended, increased 23.8 percent to Rs 899 crore in quarter ended September 2017, year-on-year.
Numbers were ahead of estimates as a CNBC-TV18 poll had expected profit at Rs 251.6 crore and NII at Rs 861.1 crore for the quarter.
Asset quality improved in quarter gone by. Gross non-performing assets declined to 2.39 percent from 2.42 percent and net NPA fell to 1.32 percent from 1.39 percent on sequential basis.
In absolute terms, gross NPAs increased 4.3 percent sequentially to Rs 1,949 crore and net NPAs rose 0.4 percent to Rs 1,066 crore in July-September quarter.
Provisions for bad loans were lower by 25.3 percent at Rs 176.7 crore, compared with previous quarter but increased 5 percent on year-on-year basis.
Operating profit during the quarter jumped 22.8 percent to Rs 583.2 crore and other income rose 5.6 percent to Rs 287.2 crore compared with year-ago quarter.
Slippages came in at Rs 284 crore for the quarter ended September 2017, which were much lower compared with Rs 425 crore in previous quarter.
Net interest margin also improved to 3.31 percent from 3.13 percent on sequential basis.
The bank said restructured book at the end of September quarter stood at Rs 1,746 crore against Rs 1,676 crore in Q1FY18.
At 12:38 hours IST, the stock price was quoting at Rs 121.35, up Rs 4.15, or 3.54 percent on the BSE.
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