YES Bank Q2 Results: PAT more than doubles on stable income; CEO says can be ‘right time’ to acquire MFI

Overall advances of the bank rose 12 per cent y-o-y to ₹2.35 lakh crore, while deposits rose 18 per cent y-o-y to ₹2.77 lakh crore. The lender will continue focusing on growing its SME and mid-corporate loan segment, its management said. Overall, the lender is targeting 17-18 per cent deposit growth and loan growth of 13-14 per cent in FY25.

Further, YES Bank’s asset quality improved, with gross and net non-performing asset ratios (GNPA, NNPA) falling to 1.6 per cent and 0.5 per cent in Q2FY25, respectively, from 1.7 per cent and 0.5 per cent a quarter ago. Slippages in unsecured loans will remain range bound in H2FY25, and start moderating from FY26 onwards.

The bank’s net interest margin (NIM) was flat on a sequential basis at 2.4 per cent. The biggest drag on NIM (70 basis points), officials say, was due to funds parked in the low-yielding Rural Infrastructure Development Fund (RIDF). As deposits parked in RIDF start reducing from H2FY25, the pressure on NIM could ease, the management said.

Lastly, the bank’s MD & CEO Prashant Kumar said that the lender remains open to and that this could be the “right time” to acquire a microfinance institution (MFI), despite stress being witnessed across the MFI segment.