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HDFC Bank, India's Largest Private Sector Bank, Reports An 18.5% Increase In Net Profit

HDFC Bank, India's Largest Private Sector Bank, Reports An 18.5% Increase In Net Profit
India's largest private sector Bank, HDFC Bank, announced an 18.5% increase in its net profit for the October-December quarter on Saturday, helped by higher top-line and loan growth.
The net profit for the quarter was 122.59 billion rupees ($1.51 billion), up from 103.42 billion rupees the previous year. According to Refinitiv IBES data, this was higher than analysts' forecast of 118.33 billion rupees.
Net interest income, which is the difference between interest earned and interest paid, increased by 24.6% to 229.88 billion rupees from 184.44 billion rupees. For the quarter, the core net interest margin was 4.1%.
HDFC's advances increased by 19.5% in the third fiscal quarter, retail loans increased by 21.4%, commercial and rural banking loans increased by 30.2%, and other wholesale loans increased by 20.3%.
Deposits increased by 19.9%, owing to higher time deposits as well as current and savings account deposits.
Credit offtake in India has increased in recent months due to persistent demand for loans, causing lenders to compete for deposits. According to the latest Reserve Bank of India data, loans at Indian banks increased 17.4% year on year in the two weeks ending December 16, while deposits increased 9.36%.
The asset quality of HDFC Bank remained stable over the previous three months, with the gross non-performing assets (NPA) ratio remaining unchanged at 1.23% and the net NPA ratio remaining unchanged at 0.33%.
Provisions and contingencies decreased slightly from 29.94 billion rupees last year to 28.06 billion rupees this year.
The bank's credit cost ratio fell to 0.74%, down from 0.87% in the previous quarter and 0.94% a year ago.

Christopher J. Mitchell

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