Kotak Mahindra Bank’s 67% profit jump beats expectations

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Kotak Mahindra Bank It beat expectations on Saturday with a 67 percent year-on-year rise in net profit for the first quarter from April to June, supported by higher net interest income and strong loan growth.

The private lender’s standalone net profit rose to ₹3,452 crore for the fiscal first quarter, above analysts’ average estimate of ₹3,240 crore, according to Refinitiv data.

Kotak’s net interest income, the difference between interest earned and paid, increased by 33% to Rs.6,234 crore. Net interest margin grew to 5.57 percent from 4.92 percent in the same quarter last year.

Also read: Bandhan Bank records a 19% drop in net profit in the first quarter of FY24

Loans grew 19 percent, while deposits rose just over 22 percent.

Indian banks continued to report Double-digit credit growth in recent months due to strong demand for loans. Lenders have boosted their deposit base amid tight liquidity conditions.

Strong credit growth helped private banks like HDFC Bank and IndusInd Bank post double-digit earnings growth in the April-June quarter.

Kotak Mahindra Bank Asset quality was largely stable during the quarter.

Total non-performing assets (NPA) reached 1.77 percent at the end of June, compared to 1.78 percent at the end of March, while the net NPA rate was 0.40 percent, compared to 0.37 percent at the end of the previous three months.

Provisions and contingencies, net of recoveries made against loan accounts written off as bad, reached ₹ 364 crore during the quarter. Its provision coverage rate was 78 percent.