HDFC Bank Q3 Results: Net Profit Jumps 18% To ₹ 8,758.3 Crore, Asset Quality Improves

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HDFC Bank, the country’s largest private lender, reported a net profit of ₹ 8758.3 crore on Saturday, January 16, marking an 18.1 rise in the October-December quarter. The bank’s total income increased to ₹ 37,522 crore on a standalone basis as compared to ₹ 36,039 crore in the year-ago period. The growth in the third quarter was mostly led by non-interest income as well as pre-provision operating profit with improved asset quality performance.

  1. The asset quality of the bank improved during the October-December quarter as the gross non-performing assets (NPA) ratio stood at 0.81 per cent of the total assets as against 1.42 per cent in the year-ago period and 1.08 per cent at the end of the preceding September quarter, according to HDFC bank.
  2. HDFC Bank’s net revenues or net interest income plus other income grew to ₹ 23,760.8 crore in the third quarter of the current financial year from ₹ 20,842.2 crore in the year-ago period.
  3. HDFC Bank’s net interest income – the difference between interest earned and interest expended – grew by 15.1 percent to ₹ 16,317.6 crore in the third quarter, driven by advances growth of 15.6 percent, and a core net interest margin for the quarter of 4.2 percent, as compared to ₹ 14,172.9 crore in the year-ago period.
  4. The operating expenses for the third quarter were ₹ 8,574.8 crore, an increase of 8.6 per cent over ₹ 7,896.8 crore during the corresponding quarter of 2019. The cost-to-income ratio for the quarter was at 36.1 per cent as against 37.9 per cent for the corresponding quarter of 2019.
  5. The restructuring under the Reserve Bank of India resolution framework for COVID-19 was approximately 0.5 per cent of advances.
  6. The total credit cost ratio was at 1.25 per cent, declining from 1.41 per cent in the previous quarter, and from 1.29 per cent in the corresponding quarter from the year-ago period, said the bank.
  7. The non-interest income or other income was at ₹ 7,443.2 crore – 31.3 per cent of the net revenues, for the third quarter of the financial year, as against ₹ 6,669.3 crore in the corresponding quarter of 2019, driven by fees and commissions and sale or revaluation of investments.
  8. The bank said that it continues to hold provisions as of December 31, 2020, against the potential impact of COVID-19 in the excess of the RBI prescribed norms.
  9. In the second quarter of the current financial year, HDFC Bank reported a net profit of ₹ 7,513.11 crore, marking an increase of 18.41 per cent as compared to the corresponding period a year ago.
  10. At 4:00 pm on Friday (January 15), shares of HDFC Bank settled 0.12 per cent lower at ₹ 1466.35 apiece on the BSE.
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