By Siddhi Nayak
MUMBAI (Reuters) – India’s Yes Bank reported a bigger-than-expected 46% rise in net profit for the April-June quarter on Saturday, helped by a drop in loan-loss provisions and robust loan growth.
The Mumbai-based private lender’s standalone net profit rose to 5.02 billion rupees ($60 million) for the financial first quarter from 3.43 billion rupees in the same period a year earlier.
That exceeded analysts’ average forecast of 4.27 billion rupees, according to LSEG data.
Provisions and contingencies, or funds kept aside for potential bad loans, fell 41% to 2.12 billion rupees.
Yes Bank’s loans grew 14.7% on year, while deposits rose 20.8%.
Indian banks have consistently experienced healthy demand for loans as economic growth has been strong and urban consumption demand high. Banks, however, are trying to raise deposits to fund the credit growth that has kept margins under pressure.
Yes Bank’s net interest income, the difference between the interest earned on loans and paid to depositors, rose 12% to 22.44 billion rupees.
The net interest margin, a key profitability measure, was down to 2.4% from 2.50% a year earlier but was flat from the previous three months.
The gross non-performing asset ratio was 1.7% at end of April, flat from the end of the previous three months.
Shares of Yes Bank closed 3.8% lower on Friday ahead of the results.
($1 = 83.7240 Indian rupees)
(Reporting by Siddhi Nayak; Editing by William Mallard)
