IDFC First Bank reported a 35% rise in net profit to Rs 751 crore in the quarter ended September compared to Rs 556 crore a year ago.

The private sector bank’s net interest income (NII) grew 32% to Rs 3,950 crore in the fiscal second quarter from Rs 3,002 crore in the earlier year.

Net interest margin increased to 6.32% as against 5.83% a year ago.

The lender's asset quality improved, with gross non-performing assets (NPAs) declining to 2.11% compared to 3.18% in the earlier year and 2.17% in the preceding quarter.

Net NPAs fell to 0.68% from 1.09% a year ago and 0.70% a quarter ago. 

Provision coverage ratio (including technical write-off) of the bank has increased to 84.09 per cent as of September 30, 2023 from 76.49 per cent as of September 30, 2022, it said.

Standard restructured book as percentage of total funded assets improved to 0.38% from 1.03% a year ago.

Capital adequacy ratio increased to 16.54% compared to 14.63% at the end of September 2022.

The core operating profit, which is the pre-provision operating profit excluding trading gains, stood at Rs 1,456 crore in the September 2023 quarter, up 38% from Rs 1,052 crore in the year-ago period.

The lender's core operating income – NII plus fees and excluding trading gains – rose 35% year-on-year to Rs 5,326 crore in Q2FY24.

Customer deposits rose 44% year-on-year to Rs 1.65 lakh crore as of 30 September 2023. 

The low-cost CASA (current account savings account) deposits during the second quarter grew 26% year-on-year to Rs 79,468 crore. The CASA ratio stood at 46.4%.

Retail deposits grew 50% year-on-year to Rs 1.28 lakh crore. It constituted 77% of the bank’s total customer deposits as of 30 September 2023.

“Diversified customer deposits are the most important foundational capability for a bank," said IDFC First Bank managing director and CEO V Vaidyanathan. 

During the first week of October 2023, the bank raised Rs 3,000 crore from a set of investors via qualified institutional placement (QIP) at an issue price of Rs 90.25 per share.