AU Bank Q4 net doubles, lender issues bonus shares

Kolkata: AU Small Finance Bank has announced double benefits for shareholders to mark its fifth year of operations while it more than doubled its March quarter net profit at Rs 346 crore riding on lower cost of funds and rise in core income.

The company's board recommended a bonus issue of one equity share for every equity share held.

Besides, the board proposed Rs 1 dividend per equity share of Rs 10 face value for FY22. To be sure, both the moves are subject to approval by the shareholders and other statutory and regulatory bodies.


"We are a retail franchise. We wanted to support and attract retail investors as we celebrated our five-year journey," AU managing director Sanjay Agarwal told ET.

The dividend will be calculated on pre-bonus equity capital.

The bank's net profit for the March quarter at Rs 346 crore was buoyed by a 29% rise in interest income at Rs 1,667 crore. Net profit was Rs 169 crore in the year-ago period. Its cost of funds dipped 88 basis points year-on-year to 5.9%.

Its asset quality improved with gross non-performing assets ratio at 1.98% against 4.3% a year back. Net NPA was at 0.5% against 2.2% over the same period.

The bank's assets under management grew 27% year-on-year to Rs 47,831 crore with about 88% of it being retail in nature.

"There was pent-up demand which helped the business grow. I am also bullish on the current year's growth despite certain headwinds like inflation, geopolitical crisis and possible reversal in the easy interest rate cycle," Agarwal said.

The bank's deposits grew by 46% to Rs 52,585 crore with CASA ratio at 37%.

Agarwal said that the bank would raise capital this year but the details are yet to be firmed up.