Despite higher provisioning for bad loans, YES Bank’s net profit for the third quarter (October-December) jumped 35 per cent to Rs 342 crore.
The profitability came on the back of strong interest income and ‘other income’.
The private sector lender had reported a net profit of Rs 254 crore in the year-ago period.
Net interest income (difference between interest earned and interest expended) grew 36 per cent to Rs 584 crore (from Rs 428 crore in Q3 FY12).
Net interest margins edged up to 3 per cent (2.8 per cent in Q3 FY12).
During the quarter, non-interest income or ‘other income’ soared by 48 per cent to Rs 313 crore (Rs 211 crore in Q3 FY12) on account of fee income from financial advisory services (50 per cent) and transaction banking (26 per cent).
Provisions in the quarter increased by 139 per cent to Rs 55 crore from Rs 23 crore in the year-ago period.
“We have been expanding our retail portfolio. For us, it is important to do cross-selling and we are happy with customer acquisitions. We do not see any rate cut in savings bank deposits in the near future,” said Jaideep Iyer, Senior President, Financial Management, YES Bank.
RBS acquisition
The mid-sized private lender said it was open to acquiring foreign bank Royal Bank of Scotland Group’s India assets.
“If the opportunity comes our way, it will be a strategically important decision which will help expand our customer base, human resources, liabilities and assets,” Iyer said.
If the RBS acquisition comes through, it may help YES Bank enter into the credit card and mortgage business platform, he added.
The shares of the bank touched a new high of Rs 535 a share but closed lower at Rs 518.25, down 1.87 per cent on the Bombay Stock Exchange.