 "Federal Bank net profit up 18%")
Kerala-based Federal Bank has posted a 42 per cent rise in net profit during the first quarter of 2023-24 at Rs 854 crore, this is compared to Rs 601 crore during the same quarter in FY23.
The bank posted a 34 per cent rise in operating profit in April to June FY24 at Rs 1,302 crore, compared to Rs 973 crore in the same quarter in FY23. In the latest quarter, net interest income grew 20 per cent to Rs 1,919 crore compared to Rs 1,605 crore in Q1 FY23. The bank’s gross non-performing asset (GNPA) at the end of the quarter stood at Rs 4,434.77 crore, which as a percentage of gross advances comes to 2.38 per cent, improving from 2.69 per cent last year. Net NPA stood at Rs 1,274.59 crore, and net NPA as a percentage of net advances is at 0.69 per cent, improving from 0.94 percent in the corresponding quarter last year.
“We have had a strong start to FY 24, despite Q1 traditionally being a seasonally soft quarter, by having broad-based growth across all our businesses. I am pleased that our total business crossed the Rs 4-lakh-crore mark aided by 21 per cent growth in both our deposits and advances. This has resulted in net profit growth. The continued improvements in our return ratios are encouraging and we are cautiously optimistic of continued traction as we set our sights on becoming the most admired bank,” said Shyam Srinivasan, Managing Director, and chief executive officer, Federal Bank.
The bank is reportedly looking to raise around Rs 4,000 crore in 2023-24. “We are evaluating. We have shareholder approval to go up to Rs 4,000 crore in the form of QIP or a preference. That is our permissible limit,” he added.
Srinivasan added that the company is reconsidering the option of an initial public offering in its non-banking financial company Fedbank Financial Services Ltd (Fedfina). “The company had filed the DRHP last year but the markets were not ideal that time. The company is reconsidering options of reconsidering raising capital this year. We as a bank hold 74 per cent of the company. We will continue to be a majority shareholder,” he added.
The bank’s total business during the quarter increased by 21 per cent to Rs 405,983 crore, as against Rs 335,045 crore during the same quarter last year. During the period under review, net advances grew by 20.96 per cent year-on-year to reach Rs 183,487.41 crore. On the assets side, retail advances grew by 17.04 per cent to reach Rs 58,472.85 crore. Business Banking grew by 18.24 per cent to reach Rs 15,040.27 crore. Commercial banking advances registered a Y-o-Y growth of 22.11 per cent to reach Rs 18,369 crore.
The Bank’s Net worth on a Y-o-Y basis increased from Rs 19,266.96 crore as on June 2022 to Rs 22,247.75 crore as on June 2023. The Capital Adequacy Ratio (CRAR) of the Bank, stood at 14.28 per cent at the end of the quarter.
