Yes Bank Clocks A Consistent 25.1% Growth In Profit In Q2FY18
Yes Bank continues to clock a steady pace of growth. The bank recorded a strong profit growth of 25.1 percent for the second quarter FY18 clocking profits of Rs 1002.7 crore on the back of a strong operational performance, improved efficiency and productivity.
Yes Bank’s operational performance continues to be robust. The bank recorded a strong 35 percent growth in advances to Rs 1,48,675.3 crore, and a 33 percent growth in net interest income to Rs 1,885.1 crore.
Advances improved both on the corporate and retail side showed improvement. Retail advances, however, grew at a faster pace on a small base registering a growth of 78 percent y-o-y. Retail assets have zoomed to 11.4 per cent of advances as against 10.5 percent in the June 2017 quarter.
Yes Bank saw a strong expansion in net interest margins to 3.7 percent from 3.4 percent in Q2FY17. This has come on the back of a strong growth in current and savings accounts deposits which increased 6.9 percent. CASA now stands at 37.2 percent of total deposits.
Commenting on the results and financial performance, Mr. Rana Kapoor, Managing Director & CEO, YES BANK said, “YES Bank has delivered another quarter of satisfactory performance with sustained earnings momentum, increasing granularity and improving efficiency, driven by productivity gains from investment in Human Capital, Infrastructure and new age technologies.”
”The bank’s retail banking advances have posted robust growth of 78% y-o-y to 11.4% of outstanding book and sustained momentum in CASA accretion gives us the confidence to achieve our target CASA ratio of 40% by September 2018, well ahead of our earlier target date of March 2020,” Kapoor said.
Yes Bank’s fee income increased 35.4 percent y-o-y to Rs 1,284.4 crore while operating profit clocked a growth of 37.6 percent to Rs 1906.7 crore.
Bank’s investments in new age technologies and digital channels has resulted in efficiency and productivity improvement with the cost-to-income ratio coming in at 39.2 per cent.
On the shareholder returns front, the bank continues to post consistent returns clocking a return on equity at 17.2 percent for Q2FY18, and a steady return on assets of 1.7 percent.
However, the bank reported an increase in net non-performing assets which came in at 1.04 percent as against 0.29 percent in Q2FY17 recognising and incorporating RBI’s new observations. Out of the headline number of Rs 6,355 Cr divergence observed during RBI RBS exercise, only Rs 1,219 Cr is NPA as on Sept 30, 2017. Rest Rs 5,136 has been regularized (upgraded to standard), repaid or sold to ARC.
“The bank’s asset quality continues to demonstrate resilience after duly incorporating full impact of the RBI RBS observations for FY17, concluded in October 2017. Going forward, Bank’s ‘Digital’ focus will continue to drive our strategy to deliver innovative solutions and rapidly capture market share across the new age payment platforms and digital ecosystems,” Kapoor said.
The bank’s capital adequacy ratio stood at 17.8 percent, and is comfortably placed. Yes Bank has further raised Rs6,915 crores of capital funds taking aggregate position to Rs42,605.3 crore.
