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Jul 12, 2012, 08.23 AM IST
Private sector lender IndusInd Bank's net profit grew higher than expected 31.1% year-on-year to Rs 236 crore for the quarter ended June 2012. Analysts on average had expected at Rs 228 crore.
Kickstarting the first quarter (April-June) earnings, private sector lender IndusInd bank reported a forecast beating 31% year-on-year jump in net profit at Rs 236 crore supported by higher net interest income (NII) and other income growth. A CNBC TV18 poll expected the bank to post 27% growth in net profit in Q1.
NII or the difference between interest earned and paid out grew 24.1% y-o-y to Rs 484 crore while other income shot up more than 48% to Rs 319 crore during the quarter.
"The Bank has coped well in a deteriorating operating environment to deliver a healthy growth in the bottom line and balance sheet while maintaining the quality of the loan book," Romesh Sobti, managing director and CEO, IndusInd Bank said.
Its loan book expanded by 31% y-o-y to around Rs 37,200 crore. The spurt in loan growth however was on a lower base but it widely surpassed RBI's projection of industry credit growth at 17% in FY13. Banks' credit normally grow at a slower pace in the so-called lean period (April-September). Moreover, Indian companies mostly put their expansion plans on hold due to overall slowdown in economy.
Retail loans seem to have supported the bank's loan escalation more than corporate credit.
Deposits grew around 28% y-o-y to Rs 45,100 crore. The share of current account and savings account (CASA) stood at 27.86% as against 28.20% in the corresponding quarter of the previous year. However, CASA increased 26% y-o-y in absolute terms.
"Despite economic slowdow, our balance sheet grew 34% y-o-y. Our loan book will continue to grow at 24-25% in the rest of year. We chose to borrow from the market instead of mopping up high cost deposits," Sobti told reporters while addressing a press conference here in Mumbai.
The lender's net non-performing asset (NPA) ratio remained unchanged at 0.27% quarter-on-quarter while the gross NPA improved a tad from 0.98% (in Q4, FY12) to 0.97% in Q1, FY13. Its restructured book fell by 24 basis points.
The asset quality is in line with the market expectation, which suggests better asset quality for private sector banks over their public sector peers.
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