Axis Bank on Thursday reported a 18 percent rise in its net profit at Rs 6917.57 crore in September 2024 quarter year-on-year, helped by higher core lending income on the back of strong credit demand.
The Mumbai-based private lender had reported a net profit of Rs 5,864 crore crore in the July-September quarter of preceding 2023-24 fiscal, the company said in an exchange filing.
The net interest income of the lender was reported at Rs 13,533 crore, higher than nearly 10 percent from Rs 12,315 crore last year.
The total income increased to Rs 37,142 crore in the reporting period from Rs 31,660 crore crore a year ago. Sequentially, the lender reported Rs 35,844 crore in June 2024 quarter.
Amitabh Chaudhry, MD & CEO, Axis Bank said, "This quarter we balanced digital prowess and advancement with physical expansion and proximity to our customers. We have opened 150 new branches in the last three months, both urban and rural. The Bank strengthened its regional presence by laying the foundation for a new Corporate Office in Kolkata, which will be the hub for all activities in the Eastern region."
"We also expanded our private banking business ‘Burgundy Private’ network to 15 new cities increasing its presence to 42 locations across India, offering bespoke wealth management services in India's rapidly evolving Tier 2 markets," he added.
The bank earned an interest income of Rs 30,420 crore during the quarter compared to Rs 26,626 crore a year ago.
Asset quality
The bank reduced its gross non-performing assets (NPAs) to 1.44 percent of total loans by the end of September 2024, down from 1.73 percent a year earlier. Similarly, net NPAs, or bad loans, dropped to 0.34 percent from 0.36 percent at the end of the second quarter of the previous fiscal year.
Recoveries from written off accounts for the quarter was Rs 984 crores. The lender had reported a net slippages in the quarter adjusted for recoveries from written off pool was Rs 1,390 crores, of which retail was Rs 2,164 crores, CBG was Rs 31 crores and Wholesale was negative Rs 805 crores, release said.
In the reporting quarter, gross slippages of the bank stood at Rs 4,443 crores, compared to Rs 4,793 crores in a quarter ago period and Rs 3,254 crores in a year ago period. Recoveries and upgrades from NPAs during the quarter were Rs 2,069 crores. The Bank in the quarter wrote off
NPAs aggregating Rs 3,119 crores.
As on September 30, 2024, the lender's provision coverage, as a proportion of Gross NPAs stood at 77 percent, as compared to 79 percent in a year ago period and 78 percent in a quarter ago period, release said.
The Bank holds cumulative provisions (standard + additional other than NPA) of Rs 11,815 crore at the end of Q2FY25. "It is pertinent to note that this is over and above the NPA provisioning included in our PCR calculations," bank said in a release.
Deposit growth
In July-September quarter, Axis Bank's total deposit grew by 14 percent on-year to Rs 10.87 lakh crore, from Rs 9.56 lakh crore in a year ago period.
Current account and savings account (CASA) deposit of the bank grew to Rs 4.41 lakh crore in the reporting quarter, from Rs 4.24 lakh crore in a year ago period. Of the total CASA deposit, current account deposits stood at Rs 1.43 lakh crore, which saw a growth of 8 percent on-year, and savings account deposit stood at Rs 2.99 lakh crore, up 2 percent on a yearly basis.
CASA Deposits as percent of total deposits in July-September quarter has declined to 41 percent, as compared to 44 percent in a year ago period, release said.
During the post earnings call, bank's management on the CD ratio said that it is inline with the discussion the lender had with the regulator. Also, they added that the lender do not want to specify any number for the CD ratio.
Advances
The Bank’s advances grew 11 percent on-year and 2 percent on-quarter to Rs 9.99 lakh crore as on September 30, 2024.
Retail loans grew 15 percent on-year and 2 percent on-quarter to Rs 5.98 lakh crore and accounted for 60 percent of the net advances of the Bank. The share of secured retail loans was around 71 percent, with home loans comprising 28 percent of the retail book.
Home loans grew 5 percent on-year, Personal loans grew 23 percent on-year, Credit card advances grew 22 percent on-year, Small Business Banking (SBB) grew 23 percent on-year and 6 percent on-quarter; and rural loan portfolio grew 20 percent on-year and 1 percent on-quarter, release added.
Update on Axis Capital
The management of the Axis Bank said that the curbs on the Axis capital by the Securities and Exchange Board of India (SEBI) is unlikely to have any impact on the group.
On September 19, SEBI has restrained Axis Capital (ACL) from undertaking any new assignments in the capacity of merchant banker, arranger or underwriter for any issue of securities in the debt segement.
On September 20, Axis Bank clarified on Friday, 20 September that Sebi order this week placed temporary curbs only on taking up any new assignments in the capacity of a merchant banker for its wholly owned subsidiary Axis Capital Ltd (ACL).
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