During the quarter, core operating income stood at ₹3,947 crore in Q2FY23 rising by 35% compared to ₹2,930 crore in Q2-FY22 aided by strong NII and fee income growth.
Meanwhile, net interest income (NII) climbed by 32% to ₹3,002 crore in Q2FY23 from ₹2,272 crore in Q2 of FY22. Net interest margin expanded to 5.98% in the quarter under review from 5.83% in Q2FY22 and 5.89% in Q1FY23.
V Vaidyanathan, the Managing Director, and CEO, IDFC FIRST Bank, said, “We have built a strong foundation at the bank over the past three years. This includes a strong retail liabilities franchise with strong CASA ratio of 50% and great service standards. Our philosophy of ethical banking and high levels of corporate governance are also our pillars. I believe we can grow from here on in a stable manner."
The MD said, "Our profit after tax has grown consistently for the 5th consecutive quarter, reflecting the resilience of our franchise. I am happy to share that we have posted the highest-ever profit in the history of the Bank this quarter at ₹556 crore, driven by strong growth in core operating income. We are confident of sustaining this trend as the new lines of businesses launched, such as cash management, wealth management, FASTag, and credit cards, are at the start of the journey and have immense potential going forward."
Further, in Q2FY23, the provisions stood at ₹424 crore up by 11% yoy. The Bank is well on track to meet the asset quality and credit cost guidance. Based on the improved portfolio performance indicators, the Bank is confident it to achieve its FY23 credit cost guidance at lower than 1.5% of the total average funded assets.
In Q2FY23, the bank's gross NPA stood at 4.27% compared to 3.36% in Q1FY23 and 3.18% in Q2FY22. Net NPA came in at 2.09% in Q2FY23 compared to 1.30% in Q1FY23 and 1.09% in Q2FY22.
Vaidyanathan added, "on the asset quality front, we have a long track record of 12 years of maintaining our retail gross NPA and net NPA at around 2% and 1% respectively through the economic slowdown in 2010-2014, Demonetisation in 2016, GST implementation in 2017, and ILFS crisis in 2018-19. I am happy to share that even after COVID, the retail asset quality has reverted to long-term sustainable levels with GNPA of 2.03% and NNPA of 0.73% as of September 30, 2022."
During the quarter, the bank's GNPA and NNPA of the Retail and Commercial Finance book were at 2.03% and 0.73% respectively, QoQ improvement by 8 basis points and 20 basis points respectively.
As of September 30, 2022, IDFC First's funded assets jumped by 25% yoy to ₹1,45,362 crore. Retail Loan and Commercial loans grew by 40% yoy to ₹1,09,669 crore, of which Home Loans grew by 59% yoy. Corporate Book (Non-Infrastructure) grew by 20% on yoy basis to ₹24,883 crore. However, infrastructure financing dipped by 41% yoy to ₹5,992 crore.
In terms of deposits, IDFC First Bank garnered customer deposits of ₹1,14,004 crore up by 36% yoy. CASA Ratio was at 51.28% as on September 30, 2022, as compared to 50.04% as on June 30, 2021 and as compared to 51.28% as on September 30, 2021. Average CASA Deposits grew by 32% YoY and by 13% QoQ.
As of September 31, 2022, the bank has 670 branches and 812 ATMs(including recyclers) across the country. The Bank has added 29 branches and 93 ATMs since March 31, 2022.
