HDFC Bank posts record profit in Q4: Key takeaways
Net interest income (NII) rose 22.8 per cent YoY to Rs 13,089.50 crore.
Here are key takeaways from the private lender’s quarterly and yearly numbers.
HDFC Bank’s Rs 5,885.10 crore quarterly profit was highest ever for any quarter, as per data compiled from AceEquity database. This was the third straight quarter when the lender’s profit was in excess of Rs 5,000 crore. Earlier, the bank had reported Rs 5,585 crore profit for December quarter and Rs 5,005.70 crore for September quarter.
NII growth strong
Net interest income (NII) rose 22.8 per cent YoY to Rs 13,089.50 crore. The numbers were driven by an average asset growth of 19.8 per cent.
NIM broadly in range
Net interest margin (NIM), which is the difference between interest income earned and the interest paid by a bank, came in at 4.4 per cent compared with 4.3 per cent in December quarter and 4.4 per cent in the year-ago quarter. HDFC Bank’s NIM has been consistent at 4.3-4.4 per cent for 10 quarters now.
Non-interest revenue up 15%
Other income, or non-interest revenue, came in at Rs 4,871.2 crore for the quarter, up 15.2 per cent from Rs 4,228.60 crore reported for the same quarter last year.
NPA, provisions drop sequentially
Percentage of gross non-performing assets stood at 1.36 per cent as of March end against 1.38 per cent in December quarter and 1.30 per cent in the same quarter of the previous year. Provisions for the quarter rose to Rs 1,889.20 crore from Rs 1,541.10 crore in the year-ago quarter, but were less than 22,11.53 crore in the December quarter.
Wholesale loans up 31.9%
Domestic retail loans grew by 19 per cent and domestic wholesale loans grew by 31.9 per cent, with retail-wholesale mix at 54:46. Total advances as of March 31 stood at Rs 8,19,401 crore, up 24.5 per cent YoY. Domestic advances grew 24.6 per cent as of March 31, 2019. Total balance sheet size as of March 31, 2019 rose to Rs 1,244,541 crore from Rs 1,063,934 crore as of March 31, 2018.
Strong capital adequacy
The bank said total capital adequacy ratio (CAR) at 17.1 per cent as on March 31 was much higher than the regulatory requirement of 11.025 per cent. The ratio in FY19 improved over 14.8 per cent at the end of March 2018. Tier 1 CAR was at 15.8 per cent as of March 31 was better than 13.2 per cent in the year-ago period.
53% branches in semi-urban, rural areas
The bank said it has distribution network of 5,103 banking outlets and 13,160 ATMs across 2,748 cities towns as of March 31, out of which 53 per cent are in semi-urban and rural areas.
The private lender had a network of 4,787 banking outlets and 12,635 ATMs across 2,691 cities in the year-ago period. The bank has 98,061 employees at the end of FY19 as against 88,253 in FY18.
Delisting of GDRs
The board members approved the proposal for termination of the GDR programme and delisting of 22 GDRs (representing 11 underlying equity shares of the bank cumulatively) in view of minimal number of GDRs outstanding and the low trading volume of the GDRs.
The bank board of directors has recommended a dividend of Rs 15 per share for FY19 against FY18's Rs 13 per share.
Update on subsidiaries
For FY19, HDFC Securities reported total income of Rs 782.1 crore, which was less than Rs 800.1 crore in FY18. Profit after tax for the year came in at Rs 329.8 crore. This was also lower than Rs 344.7 crore reported for the year-ago quarter. In the case of HDB Financial Services, NII grew 17.2 per cent to Rs 3,378.8 crore in FY19 from 2,882.2 crore in FY18. Profit after tax came in at Rs 1,153.2 crore, up 23.6 per cent over Rs 933in FY18
Consolidated net up 20.7% for FY19
The consolidated net profit for the year rose 20.7 per cent to Rs 22,332.4 crore. Consolidated advances rose 24.2 per cent Rs 8,69,223 crore in FY19 from Rs 7,00,034 crore in FY18.