Moneycontrol Bureau
Private sector lender YES Bank surpassed street expectations on Thursday with the second quarter profit after tax rising a whopping 30 percent to Rs 482.5 crore on lower provisions and higher net interest income but was impacted by higher operating expenses. Profit in the year-ago period was Rs 371 crore.
Rana Kapoor, managing director and CEO said the bank has witnessed healthy growth in profit on the back of strong NII, and continued focus on revenue and business diversity leading to a stable increase in non-interest income.
Net interest income, the difference between interest earned and interest expended, grew by 27.4 percent year-on-year to Rs 856.4 crore compared to Rs 672 crore during the same period led by steady growth in advances, coupled with expansion in net interest margin Y-o-Y to 3.2 percent (up 20 basis points Q-o-Q).
Profit was expected to grow 18 percent and NII 19 percent, according to the average of estimates of analysts polled by CNBC-TV18.
Other income (non-interest income) climbed 13.3 percent to Rs 505.6 crore in the quarter ended September 2014 compared to Rs 446.1 crore in same quarter last year.
"In the non-interest income, transaction banking grew by 45.6 percent Y-o-Y to Rs 132 crore, financial advisory income was up by 70.5 percent to Rs 211.4 crore, financial markets stood at Rs 103.9 crore; and retail banking fees & others grew 13.4 percent to Rs 58.3 crore," the bank elaborated.
Operating expenses of the bank in September quarter shot up 34.4 percent to Rs 544.88 crore from Rs 405.3 crore on year-on-year basis.
Provisions and contingencies declined 33 percent year-on-year (up 404 percent sequentially) to Rs 119.5 crore in the quarter gone by, with provision coverage at 75.8 percent as at September 2014.
The bank has continued to deliver steady performance in Q2FY15 maintaining healthy asset quality with meaningful expansion in net interest margin, Kapoor said.
Gross non-performing assets (NPA) as a proportion of gross advances increased marginally to 0.36 percent from 0.33 percent Q-o-Q and 0.28 percent Y-o-Y. Net NPA as a proportion of gross advances rose slightly to 0.09 percent from 0.07 percent and 0.04 percent during the same period.
In the absolute term, gross NPA jumped 12.3 percent sequentially (up 68.4 percent on yearly basis) to Rs 222.4 crore and net NPA climbed 25.6 percent quarter-on-quarter (up 178.4 percent year-on-year) to Rs 54 crore in July-September quarter.
Total restructured advances (excluding NPAs) stood at Rs 116.3 crore at the end of September quarter, said the bank.
Total advances during the quarter grew by 30 percent year-on-year to Rs 62,029.6 crore while total deposits increased by 18.6 percent to Rs 80,130.9 crore in the quarter gone by.
YES Bank said current and savings account (CASA) deposits grew by 30.8 percent on yearly basis to Rs 18,014.5 crore taking the CASA ratio to 22.5 percent as at September 2014, up from 20.4 percent in the year-ago period.
"The bank continues to demonstrate strong traction in CASA on the back of an increase in branch network and retail headcount, differentiated savings product offerings and steady improvements in retail branches productivity," it explained.
Meanwhile, Radha Singh today took charge as the non-executive part-time chairperson of the board for a tenor of two years, said the bank.
At 12:14 hours IST, the stock was quoting at Rs 649.40, up Rs 10.90, or 1.71 percent after hitting a record high of Rs 655.10.
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