Continuing the good run in its trading room, India’s third-largest private sector lender Axis Bank saw a 32 per cent increase in net profit to Rs 531.64 crore for the quarter ended September 30, 2009 as against Rs 402.91 crore in the corresponding period last year.
However, this is the first time that the bank’s bottom line growth has slipped below 60 per cent after eight quarters, reflecting the slowdown in credit activity in the economy.
Net interest income grew 26 per cent to Rs 1,149.68 crore in the September quarter over the year-ago period.
Trading profits were slightly muted compared to the previous quarter, but still registered a 522 per cent jump to Rs 224 crore compared to the year-ago quarter.
“Profits in the second quarter were driven by a good mix of interest income, fee income and treasury income,” said Somanth Sengupta, executive director and chief financial officer of Axis Bank.
Net interest margin (NIM) improved to 3.52 per cent during the September quarter, higher than 3.34 per cent in the June quarter, partly on account of re-pricing of deposits. As a result of the reduced interest outgo on deposits, the bank’s cost of funds fell from 6.08 per cent in the June quarter to 5.41 per cent in the September quarter.
The margins were also aided by an increase in the percentage of low-cost Current account-Savings account (CASA) deposits to 39 per cent from 37 per cent in the year-ago period.
Gross non-performing assets (NPAs) as a proportion of total consumer assets stood at 1.21 per cent as on September 30, 2009 compared to 1.01 per cent as on June 30, 2009 and 0.91 per cent as on September 30, 2008.
| Q2 REPORT CARD | ||||||
| Quarter ended | Axis Bank | SIB | DCB | |||
| (Rs crore) | Sep ‘09 | % chg* | Sep ‘09 | % chg* | Sep ‘09 | % chg* |
| Int. earned | 2,860.36 | 12.39 | 468.87 | 16.19 | 111.63 | -35.39 |
| Total income | 3,925.94 | 21.19 | 534.38 | 21.49 | 145.74 | -27.68 |
| Int. expended | 1,710.68 | 4.85 | 303.67 | 10.43 | 80.20 | -30.21 |
| Net int. income | 1,149.68 | 25.86 | 165.20 | 28.50 | 31.44 | -45.68 |
| Net profit | 531.64 | 31.95 | 72.57 | 40.42 | -16.93 | - |
| * over Sept 2008 | ||||||
The bank also restructured loans aggregating to Rs 390.09 crore during the quarter, taking the total value of assets restructured till September 30, 2009 to Rs 2,363.17 crore, constituting 2.53 per cent of gross customer assets.
For the half year ended September 30, the bank saw its net profit grow 49 per cent to Rs 1,094 crore on a year-on-year basis.
Axis Bank’s net advances in the September quarter grew 4 per cent compared to the June quarter to a total outstanding of Rs 81,044 crore.
The bank projects a growth in advances of 20 per cent for the current financial year, much lower than the 37 per cent growth registered last year.
The lender’s stock price rose 1.66 per cent on the Bombay Stock Exchange to end the day at Rs 1012.75.
