Blog

Apr 25, 2023

IndusInd Bank, one of the leading private sector banks in India, reported its fourth quarter results for the financial year 2022-23 on Monday. The bank posted a net profit of Rs 876 crore, up 111% year-on-year, but down 12% sequentially. The profit was lower than the analysts' estimates of Rs 950 crore, mainly due to higher provisions and lower other income.

The bank's net interest income (NII), the difference between interest earned and interest expended, grew by 9% year-on-year and 4% quarter-on-quarter to Rs 3,534 crore. The net interest margin (NIM), a key measure of profitability, improved by 10 basis points year-on-year and 4 basis points quarter-on-quarter to 4.39%. The bank attributed the improvement in NIM to better asset-liability management and lower cost of funds.

The bank's asset quality showed some signs of stress amid the second wave of the Covid-19 pandemic. The gross non-performing assets (NPAs) ratio increased by 15 basis points sequentially to 2.67%, while the net NPA ratio rose by 13 basis points to 0.69%. The bank's provision coverage ratio (PCR) declined by 268 basis points to 75%. The bank made provisions of Rs 1,866 crore in Q4, up 9% year-on-year and 34% quarter-on-quarter.

The bank's other income, which includes fees, commissions and treasury income, declined by 10% year-on-year and 23% quarter-on-quarter to Rs 1,560 crore. The bank said that the decline was due to lower trading gains and forex income in Q4. The bank's operating expenses increased by 11% year-on-year and 6% quarter-on-quarter to Rs 2,248 crore. The cost-to-income ratio deteriorated by 210 basis points year-on-year and 380 basis points quarter-on-quarter to 51.8%.

The bank's advances grew by 3% year-on-year and 1% quarter-on-quarter to Rs 2.07 lakh crore. The retail loans constituted 61% of the total advances, while the corporate loans accounted for 39%. The bank's deposits increased by 27% year-on-year and 7% quarter-on-quarter to Rs 2.56 lakh crore. The current account savings account (CASA) ratio improved by 670 basis points year-on-year and 130 basis points quarter-on-quarter to 43.1%.

The bank's capital adequacy ratio (CAR) stood at 16.93%, with tier-1 capital at 15.38%. The bank said that it has raised Rs 3,288 crore through qualified institutional placement (QIP) in April, which will further strengthen its capital position.

The bank's management said that it is confident of delivering a strong performance in the next financial year, despite the challenges posed by the pandemic. The bank said that it has taken various measures to support its customers, employees and stakeholders during this difficult time. The bank also said that it is focusing on digital transformation, customer acquisition and cross-selling to drive growth and profitability.

The bank's stock closed at Rs 934.65 on Monday, down 0.8% from its previous close.