New Delhi: In the third quarter of September 2024, Yes Bank, a private sector bank, saw a significant increase of 147 percent in its combined net earnings to Rs 566.59 crore, primarily due to lower provisioning. The lender based in the city had announced a net profit of Rs 228.64 crore in the same period last year, compared to Rs 516 crore in the previous June quarter. Net interest income rose by 14.3 pc to Rs 2,200 crore in the last quarter, driven by a 12.4 pc increase in total advances and a slight uptick in net interest margin to 2.4 pc.
During the quarter, there was a 16.3 per cent increase in non-interest income which amounted to Rs 1,407 crore. Overall deposits increased by 18 percent, going against the industry norm of falling below credit growth. The chief executive and managing director Prashant Kumar stated that the bank aims for a 17-18 pc increase in deposits and a 13-14 pc increase in advances in FY25. According to a senior bank official, the NIM is being affected by 0.70 per cent due to balances in the RIDF, but the NIM outlook is optimistic as there have been no deficiencies in priority sector lending in the first half of FY25, and the RIDF balances are expected to decrease gradually.
Looking at loan expansion, the bank saw a growth of more than 21 percent in its corporate loans fueled by mid-corporate segment demand, while retail loans remained unchanged.A high-ranking official told journalists that the retail sector's reluctance to expand is caused by industry-wide challenges that began appearing a few quarters ago, as well as a preference at the bank's side to pursue loan growth opportunities with higher returns on assets. The gross non-performing assets ratio saw an improvement to 1.6 per cent from 2 per cent compared to last year. The overall profits were boosted by a 40 per cent decrease in provisions, excluding tax, amounting to Rs 297 crore.
Yes Bank Reports Rs 1,314 Crore in New Slippages, Focuses on Microfinance Acquisitions Amid Retail Challenges
During the quarter, the bank experienced new slippages totaling Rs 1,314 crore, with Rs 1,179 crore originating from retail assets. Around 40 pc of the strain on retail asset setbacks is due to unsecured loans, causing difficulties for the industry. The senior official stated that losses on the unsecured sector have reached their highest point and will remain stable for the rest of the year before starting to decrease. He mentioned that the bank is not actively growing its unsecured retail portfolio, noting that there is no rise in bounce rates, and collections are strong currently. Surprisingly, while most of the sector is facing challenges with their microfinance investments, Yes Bank's MD and CEO Prashant Kumar stated that the bank is still actively seeking acquisitions in this area, as it is a lucrative sector despite current fluctuations.
ALSO READ: Indian Tourist Arrivals in Singapore Rise 13% in First Nine Months of 2024
FIRST Business Portal addressing the potential of business capability of North East Region.
