HDFC Bank, India's largest private lender, beat quarterly profit forecasts on Saturday as loan-loss provisions fell even while loan growth slowed from the previous three months.
The Mumbai-based lender posted a standalone net profit of ₹16,175 crore ($1.93 billion) for the April-June quarter.
That was above analysts' forecast of ₹15,744 crore, according to LSEG data, but it was down 2% from the previous quarter, largely due to higher tax expenses.
HDFC Bank merged with parent Housing Development Finance Corp in July 2023, so its results are not comparable on a year-over-year basis.
Provisions and contingencies plunged to ₹2,602 crore during the quarter from ₹13,512 crore in the three months to March.
The bank's net interest income - the difference between interest earned and paid - rose 2% from the previous quarter to ₹29,837 crore .
Its core net interest margin was 3.47% on total assets and 3.66% on interest-earning ones, versus 3.44% and 3.63%, respectively, in the previous quarter.
The merger with HDFC added a large pool of mortgage loans to the bank's portfolio but a much smaller amount of deposits. This has put it under pressure to increase the pace at which it raises deposits or slow loan growth.
HDFC Bank's gross loans dipped 0.8% sequentially, while deposits were flat on quarter at 2.38 trillion rupees.
The bank's asset quality deteriorated, with a gross non-performing assets ratio of 1.33% at the end of June, compared with 1.24% three months earlier.
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.