HDFC Bank increases provisions for bad loans as impact of COVID-19 continues to bear down in second quarter
- HDFC Bank registered a 15% uptake in revenue and over 18% jump in net profits in the second quarter as compared to last year.
- It also continued to increase provisions, bolstered by an increase in deposits.
- HDFC Bank shows lower retail loans, drop in collections and waivers and limit the use of debit and credit cards.
AdvertisementHDFC Bank’s revenues are up by nearly 15% in the second quarter as compared to the same period in the previous year at ₹21,868.8 crore and net profit has increased by 18.4% to ₹7,513.1 crore.
“Driven by asset growth of 21.5% and a core net interest margin for the quarter of 4.1%,” said the bank in a statement.
Provisions remain above the Reserve Bank of India’s requirement at 153% — amounting to around ₹3,703.5 crore — boosted by a healthy growth in deposits. They grew by 20.3% between July and September amounting to ₹12.29 lakh crore.
|Gross NPA ratio||1.08%|
|Net NPA ratio||0.17%|
HDFC Bank’s share price was trading 2% higher on Friday, a day ahead of its earnings. However, so far this year, the stock has registered an overall loss of 6%.
COVID-19 continues to affect HDFC Bank
The impact of COVID-19 was lower this quarter, but did still bear an impact. “While the previous quarter largely bore the brunt of COVID-19 pandemic, some of the softness continued into the current quarter leading to lower retail loan origination,” said HDFC Bank in a statement.
Use of debit and credit cards was lower as well the efficiency in collection efforts and waivers of certain fees — by approximately ₹ 800 crore.
- EXCLUSIVE: Communities, brand and then product — CEO explains how Stack Overflow flipped the script on software development
- Everybody in India must get Covid vaccine free, says Kejriwal
- Samsung now lets you buy up to four products in one single EMI as it seeks to boost sales this festive season
- Equitas Small Finance Bank IPO allotment: Here’s how to check share allotment status
- K'taka healthcare warriors first to get Covid vaccine: Minister