The private sector lender reported a 25 per cent jump in net profit in the October December quarter, which was aided by lower provisions and a strong increase in net interest income NII The lender's net profit in the reporting quarter stood at Rs 6,194 crore, its highest quarterly profit, beating Street estimates. A net profit of Rs 5,800 crore was estimated by analysts.
In Q 3 of FY 22 it's net interest income went up 23 per cent to Rs 12,236 crore compared to Rs 9,912 crore in the same period last financial year. Fee income rose by 19 per cent to Rs 4,291 crore, as well as non-interest income of the lender increased by 25 per cent to Rs 4,899 crore. The net interest margin, a measure of profitability of banks, fell 4 basis points sequentially to 3.96 per cent.
The lender's provision fell by 27 per cent to Rs 2,007 in Q 3 FY 22 from Rs 2,742 crore in Q 3 FY 21. During the current financial year, it has written back provisions to the tune of 1,050 crore.
The bank's assets quality improved with gross non-performing assets NPAs falling by 69 basis points bps, to 4.13 per cent at the end of December. Net NPAs have fallen by 14 bps to 0.85 per cent. During the quarter, gross NPA additions of the bank fell to 4,018 crore compared to Rs 5,578 crore in the previous quarter, while recoveries and upgrades were to the tune of Rs 4,209 and the gross NPAs written off were to the tune of Rs 4,088 crore.
51 crore under the second Covid 19 resolution of Reserve Bank of India. The bank's restructured book under various restructuring frameworks is to the tune of 9,684 crore or 1.2 per cent of total advances at the end of December quarter. The bank holds provisions of Rs 2,436 crore against these borrowers.
The bank's domestic loan portfolio has increased by 18 per cent YoY and 6 per cent QoQ to Rs 8.13 trillion, with retail loan portfolio growing by 19 per cent YoY and 5 per cent QoQ. The business banking portfolio grew 39 per cent YoY and 9 per cent QoQ, while SME loans grew 34 per cent YoY and 10 per cent QoQ. The wholesale book of the bank grew by 13 per cent YoY and 9 per cent QoQ.
Deposits grew by 16 per cent YoY and 4 per cent sequentially to Rs 10.17 trillion at the end of December quarter, of which low-cost deposits constituted 45 per cent.
The third wave of Covid has created local disruptions, according to Sandeep Batra, Executive Director. We do not anticipate a significant economic disruption to the portfolio we have at this point of time. We have Covid provisions that we have not released this quarter and we will wait for the third wave to subside.