Bandhan Bank Q2 Results: Profit zooms 245% YoY to Rs 721 crore

Sharply lower provisions helped private sector lender Bandhan Bank beat estimates and report a near-four-fold surge in net profit at 721 crore for the September quarter.

Net profit was 209 crore in the year-ago period at the Kolkata-based lender, the first to graduate into a universal bank in India from a regional microfinancier.

An 11.4% rise in net interest income supported the profit growth and beat market estimates.


The bank’s net interest margin (NIM) for the September quarter stood at 7.2% against 7% a year earlier.

In the quarter under review, the lender made a provision of 636 crore, which was 50% less than what it had provided for in the year-ago period. This was despite the deterioration in asset quality.

“Our credit cost is 2.5% at present. We expect it to be around 2% at the end of the fiscal,” managing director Chandra Shekhar Ghosh said, stressing upon the fact that the repayment collection efficiency has improved to 98%.

However, as things stand now, the bank’s asset quality deteriorated with the gross non-performing assets ratio rising to 7.3% at the end of September as compared with 6.8% three months prior to that and 7.2% a year ago. Net NPA was at 2.3% against 1.9% a year ago.

The bank is now carrying 6,900 crore of stressed assets, largely from its microfinance portfolio. The size of stressed assets was 6,200 crore at the end of June. The bank’s operating profit rose marginally at 1,583 crore against 1,553 crore. Its gross advances rose 12.3% year-on-year to 1.08 lakh crore while deposits climbed 12.8% to 1.12 lakh crore.