IDFC First Bank posted a net profit of Rs 715.7 crore for the fiscal third quarter ended December, up 18.4% from Rs 604.6 crore a year ago. 

NII

The private sector lender's net interest income (NII) rose 30.5% to Rs 4,286.6 crore in the December quarter, compared to Rs 3,284.3 crore in the same quarter of last year.

NIM

Net interest margin grew 6.42% in Q3 compared to 6.13% a year ago and 6.32% a quarter ago.

Asset quality

The bank's asset quality improved, with gross non-performing assets (NPA) declining to 2.04% as of December 2023, from 2.96% a year ago and 2.11% a quarter ago.

Net NPA stood at 0.68% as of December 2023, from 1.03% a year ago.

“Our asset quality continues to improve. On the retail, rural & SME accounts, which is a significant part of our business, the gross NPA and net NPA continue to remain low and are at 1.45% and 0.50% respectively as of 31 December 2023,'' said IDFC First Bank managing director and CEO V Vaidyanathan.

At the time of the merger of IDFC Bank and Capital First, the bank provided guidance of 1%. “As of 31 December 2023, IDFC First Bank has completed exactly 5 years post the merger and hence we are providing guidance of 2% (FY 24-29), with greater visibility as compared to the visibility we had at time of providing guidance of 1%. We are likely to meet most targets under guidance of 1%,'' added Vaidyanathan.

Provisions rose 45.5% to Rs 654.8 crore from Rs 450.2 crore during this period. 

Deposits

Customer deposits increased by 42.8% year-on-year to Rs 1.76 lakh crore at the end of December 2023, from Rs 1.24 lakh crore a year earlier.

CASA (current account savings account) deposits grew to Rs 85,492 crore, up 28.6% YoY from Rs 66,498 crore.

CASA ratio stood at 46.8% as of 31 December 2023.

Retail deposits grew by 46.6% YoY to Rs 1.39 lakh crore from Rs 95,107 crore a year ago. 

As of 31 December 2023, retail deposits constitute 79% of total customer deposits.

Legacy high-cost borrowing declined to Rs 13,607 crore from Rs 18,762 crore. 

Capital adequacy ratio

The capital adequacy of the bank was strong at 16.73%, with CET-1 ratio at 13.95% as on 31 December 2023.

The bank raised fresh equity of Rs. 3,000 crore in the first week of October 2023. 

Funded assets

Funded assets (including advances and credit substitutes) grew 25% year-on-year to Rs 1.89 lakh crore as of December 2023. The bank said it continues to wind down infrastructure financing, which now constitutes only 1.6% of total funded assets.