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Nirmal Bang Report
Bandhan Bank Ltd. posted weak numbers for Q2 FY23 on account of increase in slippages and higher write-offs impacting margins and muted sequential credit growth.
Net interest income growth was weak at 13.3% YoY while it declined by 12.8% QoQ, affected by higher write-offs, which impacted net interest margin by ~80 basis points.
Moreover, Bandhan Bank's other income declined by 9% YoY but increased by 44% QoQ, leading to 8.5% YoY growth in total income.
Operating expenses remained elevated, leading to an increase in the cost/income ratio to 41.8% versus 35.6% YoY.
As a result, operating profit declined by 2% YoY to Rs 15.5 billion. Provisions nearly double on a sequential basis while declined by 77% YoY to Rs 12.8 billion. Bandhan Bank reported profit after tax of Rs 2.7 billion versus a net loss of Rs 30 billion in Q2 FY22 and a net profit of Rs 8.8 billion in Q1 FY23.
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