IDFC First Bank posts ₹803 cr PAT on strong operating and interest income

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IDFC First Bank recorded a net profit of Rs.803 crore for the fourth quarter of FY23, up 134 per cent on the year, led by a 43 per cent growth in operating income to Rs.4,994 crore. For FY23, profit after tax was Rs.2,437 crore in FY23 as compared to Rs.145 crore a year earlier.

“We have recorded the highest ever quarterly and annual profits. The bank is now earning strongly, and we believe we can deliver strong financial performance going forward,” said Vaidyanathan, Managing Director and Chief Executive Officer Vaidyanathan.

Bank advances were at ₹1.6 crore as of March 31, up 24 per cent year-on-year.

In the investor call, Vaidyanathan said growth was led by retail loans, the bank is seeing strong demand across sectors and future loan growth is not a concern for the bank at all.

Net Interest Income (NII) for the quarter increased by 35 per cent YoY at INR 3,597 crore. For FY23, NII was higher by 30 per cent at Rs.12,635 crore.

Fees and other income for the fourth quarter grew by 54 per cent year-on-year to INR 841 crore, of which 91 per cent was retail charges. Vaidyanathan said the sector is growing well for the bank, led by Fastag and wealth management companies, the latter of which are growing by 40 to 50 percent over the year.

During the quarter, the bank also posted a trading gain of Rs 216 crore, which was due to recoveries of some capital investments made by the bank, CFO Sudhanshu Jain said.

deposits

Deposits were up 47 percent year-on-year at INR 1.4 crore at the end of March, with retail deposits accounting for 76 percent of the bank’s 53 percent year-on-year growth, Jain said. He added that while term deposits grew faster due to the systematic rise in interest rates, the bank is also witnessing strong traction in current deposits and savings accounts.

Provision for the quarter was ₹404 crore, which included ₹79 crore added by the bank to improve the provision coverage ratio to 80.3 per cent as of 31st March. And generally speaking, however, provisions are structurally coming down and will continue to do so. So in the coming quarters, Vaidyanathan said.

The bank’s gross NPA was 2.5 percent, and net NPA was 0.9 percent, with the retail loan numbers being 1.7 percent and 0.6 percent, respectively.