Axis Bank reported a standalone net profit of Rs 2,160.15 crore for the fiscal first quarter ended June 2021, up 94.2% over the earlier-year quarter.

The country’s third-largest private sector lender reported a year-on-year growth of 11% in net interest income to Rs 7,760.27 crore in the quarter under review.

Asset quality deteriorated in the quarter due to the second wave of Covid-19. The gross non-performing assets (NPAs) as a percentage of gross advances increased to 3.85% compared to 3.7% in the preceding quarter.

Net NPA as a percentage of net advances rose to 1.20% compared to 1.05% in the previous quarter.

Gross slippages rose 23% sequentially to Rs 6,518 crore and was almost three times from the year-ago quarter (Rs 2,218 crore in Q1FY21).

"Slippages in Q1FY21 were moderated due to regulatory forbearances that do not exist in the current quarter. Recoveries and upgrades from NPAs during the quarter were Rs 2,543 crore while write-offs were Rs 3,341 crore. Consequently, there were net slippages in NPAs (before write-offs) for the quarter of Rs 3,976 crore," Axis Bank said.

As of June 2021, the bank's provision coverage as a proportion of gross NPAs stood at 70% compared to 75% a year ago and 72% in the previous quarter.

Provisions and contingencies were at Rs 3,532.01 crore in Q1FY22, up 7.2% from the preceding quarter (Rs 3,294.98 crore), but down 20% from the year-ago period (Rs 4,416.42 crore in Q1FY21).

The bank reported a 12% YoY rise in advances to Rs 6.14 lakh crore. Retail loans grew faster at 14% and accounted for 54% of the net advances. The share of secured loans was around 80%, with home loans comprising 37% of the retail book, the bank said.

“Total deposits grew 16% on period end basis and by 11% YoY on quarterly average balance (QAB) basis," Axis Bank said.

Non-interest income (other income) grew 38.7% YoY to Rs 3,588.17 crore, led by fee income and trading profits. The fee income increased 62% YoY to Rs 2,668 crore.

"The standard restructured loans under resolution framework for Covid-19 related stress as of June 2021 stood at Rs 2,192 crore, which translates to 0.33% of the gross customer assets. The bank carries a provision of around 23% on restructured loans, which is in excess of regulatory limits," said Axis Bank.

The bank’s operating profit grew 9.8% YoY to Rs 6,416.04 crore while core operating profit rose 13%.