Kerala-headquartered Federal Bank has reported a net profit of Rs 1,006.74 crore for the fiscal third quarter ended December, up 25.3% from Rs 803.61 crore a year ago.

The private lender’s net interest income (NII) for the December quarter rose 8.5% year-on-year to Rs 2,123.4 crore.

Net interest margin (NIM) fell to 3.19% from 3.22% in the preceding quarter.

Asset Quality

The bank’s gross non-performing assets (NPA) stood at 2.29% by the end of December 2023 versus 2.26% a quarter ago and 2.43% a year ago.

Net NPA was flat on a quarter-on-quarter basis at 0.64% in Q3FY23. In the year-ago period, the lender had reported net NPA of 0.73%.

Provision coverage ratio (PCR) excluding technical write off was 71.08%. 

Slippages in Q3FY24 dropped to Rs 496 crore from Rs 373 crore in the preceding quarter.

The bank’s risk-weighted assets to advances rose to 90.9% versus 86.2% YoY and 87.8% QoQ.

“With an increase of over 100 branches in the past calendar year and a similar number planned for this year, our growth trajectory is well poised to sustain this positive momentum. As we grow and diversify across products, segments, and geography, we are further inspired to deliver on our purpose for existence, which is to be the most admired bank in India," said Federal Bank managing director and CEO Shyam Srinivasan.

Deposits

The bank’s total deposits increased 18.96% to Rs 2,39,591.16 crore as on 31 December 2023, versus Rs 2,01,408.12 crore a year ago. On a sequential basis, deposits rose 3% from Rs 2,32,868 crore in Q2FY24. 

Advances

The lender’s loan book rose 18.44% to Rs 1,99,185.23 crore from Rs 1,68,173.13 crore a year ago. In the preceding quarter, the bank reported net advances of Rs 192,817 crore.

The retail book was up by 24% YoY in Q3Y24, while the business banking book registered an 18% YoY growth. The bank also reported a 23% YoY growth in gold loans.

The bank added 65 new branches in FY24.

Capital adequacy ratio (CRAR) of the bank, computed as per Basel III guidelines, stood at 15.02% as at the end of the December quarter.

Federal Bank has 1,418 branches and 1,960 ATMs/ Recyclers as on 31 December 2023.