HDFC Bank's standalone net profit rose 5 per cent to Rs 19,060 crore in the June quarter, while net interest income increased 7 per cent.
Asset quality improved as gross and net NPAs declined and provisions for bad loans fell significantly.
The bank welcomed new chairman Rajiv Kumar and expressed confidence in business growth and FCNR deposit mobilisation.
HDFC Bank Profit Rises 5% to ₹19,060 Cr in Q1
The country's biggest private sector lender had earned a net profit of ₹18,155 crore in the year-ago period
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HDFC Bank on Saturday reported a 5% increase in standalone profit to ₹19,060 crore for the June quarter.
The country's biggest private sector lender had earned a net profit of ₹18,155 crore in the year-ago period.
However, the total income of the bank during the quarter under review dropped to ₹92,184 crore from ₹99,200 crore in the same period a year ago, HDFC Bank said in a regulatory filing.
The lender's interest income increased to ₹79,363 crore from ₹77,470 crore in the same quarter a year ago.
Welcoming new chairman Rajiv Kumar, HDFC Bank MD and CEO Sashidhar Jagdishan said the appointment has brought in a sense of stability.
Kumar, former Chief Election Commissioner and Finance Secretary, was appointed part-time chairman of the bank following the sudden resignation of Atanu Chakraborty effective March 18.
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In his resignation letter, Chakraborty had said that "certain happenings and practices within the bank are not in congruence with my personal values and ethics".
This led to a sharp fall in share prices of the bank and concerns were raised about its corporate goverance.
Kumar had been instrumental in revitalising public sector banking and the financial sector as Secretary Department of Financial Services between 2017 and 2020.
Within a fortnight of Kumar joining the Department of Financial Services, accounts of about 3.38 lakh shell companies were frozen, hitting at the architecture of black money itself. Curbs on ponzy schemes followed.
During the period, operating profit of the bank declined to ₹28,169 crore, as compared to ₹35,734 crore in the same quarter a year ago.
Net interest income grew 7% to ₹33,530 crore from ₹31,440 crore for the June quarter, it said.
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Net interest margin was at 3.26% on total assets, and 3% based on interest earning assets.
On the outlook, Jagdishan said, "We are at the cusp of pushing peddle... the environment continues to be very healthy." About FCNR deposit mobilisation, he said the rates are attractive and the bank expects good flow by the September 30 deadline.
On the the CEO reappointment process, the bank's Deputy Managing Director Kaizad M Bharucha said the new chairman has just joined the board and, as and when the Governance, Nomination and Remuneration Committee (GNRC) takes a decision about the issue, it will be shared.
The three-year term of Jagdishan will come to an end on October 26, 2026.
The bank's asset quality exhibited improvement with gross non-performing assets (NPAs) declined to 1.17% of gross advances at the end of the June quarter, from 1.4% a year ago.
Similarly, net NPAs, or bad loans, declined to 0.41%, as against 0.47% in the year-ago period.
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As a result, provisions and contingencies for bad loans declined massively to ₹3,060 crore during the first quarter, as compared to ₹14,442 crore in the same period a year ago.
Capital adequacy ratio of the bank moderated to 19.57% from 19.88% at the end of the first quarter of the previous financial year.
The consolidated profit after tax of the HDFC Bank Group for the June quarter was ₹19,245 crore as against ₹16,258 crore a year earlier, registering an 18% growth.
The bank's consolidated net revenue was ₹85,480 crore for the June quarter, it said.