Yes Bank Ltd, India's fifth-biggest private sector lender by assets, reported a better-than-expected 25 per cent increase in quarterly profit, and said it expected full-year credit costs to be at the lower end of its guidance range.
Yes Bank shares rose 4.5 per cent by 0612 GMT in a Mumbai market that was up 1 per cent.
The bank said it saw credit costs at maximum 50 basis points for the fiscal year ending March, compared with its previous guidance of 50-70 basis points.
Net profit rose to 6.76 billion rupees ($100 million) for its fiscal third-quarter to Dec. 31, beating analysts' estimate of 6.28 billion rupees on average.
Gross bad loans as a percentage of total loans rose to 0.66 per cent at end-December, from 0.61 per cent in the previous quarter.
Commenting on the results and financial performance, Rana Kapoor, managing director and CEO, said: "Yes Bank has delivered yet another consistent quarter of sustained financial performance driven by steady increase in NII on the back of an improving retail franchise, improvements in NIM, RoA, RoE and overall preservation of asset quality."
He said the bank continues to build granularity and longevity in deposits demonstrated by retail and CASA deposits contribution of 53.9 per cent as on December 31, 2015 on the back of strong SA deposits growth of 64.1 per cent year-on-year.
The CASA ratio (the ratio of deposits in current and saving accounts to total deposits) improved sequentially by 1.1 per cent in the quarter to 26.6 per cent.
"The bank is committed to building a strong retail franchise through continued investments in people, technology and digital infrastructure," Kapoor said.
