Motilal Oswal has come out with its third quarter (October-December) earnings estimates for the banking sector. The brokerage house expects YES Bank to report a 2.7 percent growth quarter-on-quarter (up 11.4 percent Y-o-Y) in net profit at Rs 381.3 crore.
Net-interest income of YES Bank is expected to increase by 0.2 percent Q-o-Q (up 15.2 percent Y-o-Y) to Rs 673.3 crore, according to Motilal Oswal.
Motilal Oswal's Report on YES Bank:
Loan growth is expected improve on a sequential basis. However, on a Y-o-Y basis, it is expected to be largely in line with industry average at 15 percent. Deposit growth to outpace loan growth and be at 25 percent+ Y-o-Y.
NIM is expected to moderate as cost of funds remains high and bank has refrained from increasing its base rate. We factor a 5bp+ Q-o-Q decline in NIM.
Fee income (ex-financial markets) growth is expected to moderate as the higher base of financial advisory catches up. Expect Y-o-Y decline in financial advisory income. Growth in transaction banking and fees from third party distribution is expected to remain strong.
YES has demonstrated strong asset quality performance over the quarters amid a challenging economic environment. We expect the healthy trend to continue.
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