Yes Bank Registers Q3 Profit Of Rs 231 Cr; 4X Increase YoY
Yes Bank, a Mumbai-based private lender, has reported that its net profit for the third quarter ending December 2023 (Q3 FY24) has more than quadrupled due to a drop in loan-loss provisions and healthy growth in loans. The standalone net profit for the three months ended on 31 December has risen to Rs 231 crore (USD 27.8 million) from Rs 51.52 crore in the same period the previous year.
However, the result still fell short of expectations, with analysts, on average, having predicted a net profit of Rs 343 crore according to London Stock Exchange Group (LSEG) data. Last year, Yes Bank's third-quarter profit was heavily impacted as it set aside more provisions on its balance sheet after transferring bad loans to private equity firm J.C. Flowers.
The bank's net interest income, which is the difference between the interest earned on loans and that paid to depositors, increased by 2.33 per cent to Rs 2017 crore. However, the net interest margin, which is an important measure of the bank's profitability, declined to 2.4 per cent from 2.5 per cent a year ago and the 2.3 per cent reported in the previous quarter.
This decline in lending margins has been observed in most Indian private banks, including HDFC Bank and ICICI Bank, due to higher re-pricing of deposits amidst tighter liquidity in the banking system. Despite this, Yes Bank's net advances grew by 11.8 per cent to Rs 2.18 trillion (USD 26.23 billion) compared to the previous year, led by retail loans, while deposits rose by 13.2 per cent.
The gross non-performing asset (NPA) ratio of Yes Bank remained at 2 per cent at the end of December, the same as the previous quarter. The bank's provisions and contingencies, net of recoveries made against loan accounts written off as bad, decreased to Rs 555 crore from Rs 845 crore in the previous year. The shares of Yes Bank rose by 0.8 per cent on Thursday before the announcement of these results. Friday was a public holiday in India.
