Yes Bank Ltd. beat analyst estimates in the first quarter of the financial year, reporting a 32.8 percent growth net profit at Rs 731.8 crore, according to a filing on the Bombay Stock Exchange. The Bloomberg consensus estimate stood at Rs 700.4 crore.
Net interest income grew 24.2 percent to Rs 1,316.5 crore from Rs 1,059.8 crore earlier.
The bank benefited from robust net interest income growth, which in turn was bolstered by a 33 percent growth in loans, and a sharp increase in current and savings accounts deposits, Yes Bank's Managing Director and Chief Executive Officer, Rana Kapoor said at a press conference on Wednesday.
Management Commentary
The most important development during the quarter was the increase in current and savings account or CASA deposits, according to Rana Kapoor.
On a year-on-year basis, CASA deposits grew by 63 percent to nearly Rs 36,300 crore. Kapoor said Yes Bank would advance its target to achieve 40 percent CASA ratio to September of 2018 from the earlier target of March 2020.
As on June 30, the bank's CASA ratio, which is current and savings account deposits as a percentage of total deposits, stood at 29.6 percent up from 23.4 percent a year ago.
The higher CASA would greatly reduce the bank's interest costs and could even push its net interest margin over 4 percent.
On plans to raise funds through a qualified institutional placement of shares, Kapoor said the bank has shareholder approval to raise $1 billion, and the issue will take place over the next eight months.
Key Highlights
- The net interest margin expanded to 3.4 percent from 3.3 percent earlier.
- Total deposits grew 28.6 percent to Rs 1,22,581 crore as on June 30, 2016.
- Total capital adequacy as per Basel III norms stood at 15.5 percent, with Tier I ratio of 10.3 percent.
Asset Quality Stable
- Gross non-performing assets increased sequentially to 0.79 percent from 0.76 percent.
- Net non-performing assets remained flat at 0.29 percent.
- Provisions rose 10.8 percent quarter-on-quarter to Rs 206.6 crore.
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