THE net profit of India’s largest private lender, HDFC Bank Ltd, grew by nearly a fifth, it said yesterday, driven by higher interest income and lower costs.
HDFC Bank’s net profit for the quarter ending June rose to 66.58 billion rupees (RM3.79 bil), up from 55.68 billion rupees a year earlier, the company said in a regulatory filing.
Net interest income grew about 18%, while operating costs fell by nearly 3%, the bank said. Higher revenue from the bank’s retail banking and treasury segments made up for a tepid quarter for wholesale banking.
Gross non-performing assets were slightly higher at 1.36% of all loans as of June 30, compared with 1.26% at the end of March quarter.
Provisions and contingencies – money set aside by the bank to account for potential defaults – for the quarter that ended June 30 rose 2.8% from the end of the March quarter to 38.92 billion rupees.
However, the bank warned of higher defaults and a potential rise in provisions.
“The continued slowdown may lead to a rise in the number of customer defaults and consequently an increase in provisions there against,” HDFC said, adding that it has already seen a fall in loan originations, the sale of some products and the use of credit and debit cards. – July 19, 2020, Reuters
