Jobaaj Stories
Mumbai-based private lender Yes Bank disappointed its investors as it reported a sharp 80% decline in profits for the quarter that ended in December 2022.
Net Interest Income, which is the difference between the Interest earned and Interest expended, registered a growth of 11.7% YoY as it surged to Rs 1,971 crores, but was down 1% on a QoQ basis. Net Interest Margin stood at 2.5% for the quarter, up 10bps YoY but down 10bps QoQ.
Total income for the quarter that ended in December 2022 came in at Rs 7,064 crores, up 24.7% YoY as the Non-interest income of the bank grew 55.8% to Rs 1,143 crores. Net Advances during the quarter grew 10.4% to Rs 194,573 crores as retail advances accounted for 44% of total advances.
Operating expenses grew in accordance with the growth in revenues. It surged 24.5% YoY to Rs 2,200 crores during the quarter, which resulted in an Operating profit of Rs 914 crores, growing 25% YoY. This was the highest operating profit reported by the bank in the past 8 quarters.
However, net profits declined 80% during the quarter ending up at Rs 55 crores as opposed to the Rs 266 crores reported in the corresponding quarter last year. The massive decline in profit was on account of the higher provisions set aside by the bank during the quarter. Provisioning during the quarter was Rs 845 crores, up 45% YoY.
The bank’s assets saw a significant improvement as Gross NPA declined to 2.02% while the Net NPA fell to 1.03% during the quarter. Gross NPAs, which were over 10% fell to such lows due to the bank’s sale of its distressed assets portfolio to JC Flowers during the quarter. CASA ratio was 29.9% while the Capital Adequacy Ratio was 18%
The stock of Yes Bank closed at Rs 16.45 per share on Friday, marking a 26% decline in value since the beginning of 2023.
Article by Aman Agarwal.
