Bandhan Bank Q1 net up 47.5% at ₹1,063.46 cr

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Bandhan Bank on Friday reported a 47.5 per cent year-on-year jump in its net profit to ₹1,063.46 crore for the first quarter this fiscal, as its operating profit witnessed over 24 per cent y-o-y rise during the period.

The Kolkata-based bank had posted a net profit of ₹721.05 crore in the first quarter last fiscal.

According to the lender’s stock exchange filing, its operating profit during the period under review increased to ₹1940.89 crore from ₹1,562.29 crore in the year-ago period. Also, provisions fell around 13 per cent y-o-y to Rs 522.99 crore in Q1FY25.

Net Interest Income (NII) during the first quarter was at Rs 3,005 crore, as against Rs 2,491 crore in the year-ago period, registering 21 per cent y-o-y growth.

MD and CEO Ratan Kumar Kesh said for the first quarter has always been a “soft quarter” for the bank in previous years. However, this time it saw “all round improvement” of the major parameters. “We have seen robust financial results driven by a pick-up in business momentum, stable margins, good control over operating expenses, and improving asset quality performance,” Kesh said.

The lender’s gross NPA ratio during Q1FY25 improved year-on-year to 4.2 per cent, compared to 6.8 per cent in Q1FY24. However, its capital adequacy ratio fell to 15.7 per cent (including profit) as of June 30, 2024, from 20.5 per cent as of June 2023. This was due primarily to an increase in risk weights on the microfinance (EEB) portfolio.

“In November, 2023, RBI has mandated higher risk weights on consumer credit from 100 to 125 per cent, with specific exemptions. The bank immediately complied with the same for our consumer credit portfolio,” the MD said, adding after consultation and with the approval of the board, the management took a decision to increase and apportion higher risk weights of 125 per cent for the entire EEB portfolio from earlier 75 per cent.

He said the process of identifying potential candidates to take on the role of MD and CEO is on track.

The board, earlier this month, appointed Kesh as Interim MD & CEO for a period of three months or till a new Managing Director & Chief Executive Officer takes charge.

The founder, Chandra Shekhar Ghosh, retired as the MD and CEO on July 9 upon completion of his tenure, after spending nearly a decade at the helm.