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AU Small Finance Bank has reported 30% growth in net profit to Rs 392.83 crore for
the quarter ended December 2022 (Q3FY2023). The bank has posted healthy 41% growth
in net interest income (NII), while the core fee income of the bank improved 7%
in Q3FY2023. The Net Interest Margin (NIM) of the bank was nearly stable at 6.20%
in Q3FY2023 compared to 6.30% in the corresponding quarter of previous year.
On business front, the bank as has posted 38% growth
in business with strong 38% surge in loan book. The asset quality of the bank
was stable in Q3FY2023. Bank has improved the credit to deposit ratio to 92.2% at
end December 2022 from 92.0% at end December 2021. However, the CASA ratio of
the bank has declined to 38.4% at end December 2022 from 39.2% at end December
2021.
Asset quality improves: The bank has maintained stable asset quality in
Q3FY2023.
The fresh slippages of loans stood at Rs 231 crore
in Q3FY2023 compared with 262 crore in previous quarter and Rs 249 crore in the
corresponding quarter last year.
The recoveries, upgradations and write off of
NPAs stood at Rs 209 crore in Q3FY2023.
The standard restructured loan book of the bank declined
Rs 789 crore end December 2022.
Provision coverage ratio improved to 75% at end
December 2022 compared to 74% a quarter ago and 51% a year ago.
Apart from provision of Rs 693 crore against GNPA pool, Bank
has, additionally, maintained provision buffer such as provision against
restructured book at Rs 127 crore (16% of restructured book), contingency
provision of Rs
98
crore (0.2% of advances), floating provision of Rs 41 crore (0.1%
of advances) and standard provisions of Rs 176 crore (0.3%
of advances).
The capital adequacy ratio of the
bank stood at 22.0% with Tier I ratio at 20.0% at end December 2022. Including
interim profits, CRAR was at 24.2% and Tier 1 at 22.2% end December 2022.
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Asset Quality
Indicators: AU Small Finance Bank
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|
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Dec-22
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Sep-22
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Jun-22
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Mar-22
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Dec-21
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Variation
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|
QoQ
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YTD
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YoY
|
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Gross NPA (Rs Crore)
|
1018.86
|
996.70
|
969.62
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924.38
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1057.57
|
2
|
10
|
-4
|
|
Net NPA (Rs Crore)
|
284.56
|
288.22
|
274.83
|
230.85
|
520.18
|
-1
|
23
|
-45
|
|
% Gross NPA
|
1.81
|
1.90
|
1.96
|
1.98
|
2.60
|
-9
|
-17
|
-79
|
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% Net NPA
|
0.51
|
0.56
|
0.56
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0.50
|
1.29
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-5
|
1
|
-78
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% PCR
|
75.00
|
74.00
|
72.00
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75.00
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51.00
|
100
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0
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2400
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% CRAR - Basel III
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21.97
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23.36
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19.36
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21.00
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19.55
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-139
|
97
|
242
|
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% CRAR - Tier I -
Basel III
|
20.00
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21.30
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18.40
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19.70
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18.20
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-130
|
30
|
180
|
|
Variation in basis
points for figures given in percentages and in % for figures in Rs crore
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Business Highlights:
Healthy business growth: The business of the bank has increased 38% YoY
to Rs 117436 crore end December 2022, driven by 38% surge in advances to Rs 56335
crore. Deposits rose 38% to Rs 61101 crore at end December 2022. The Balance sheet
size crossed Rs 80000 crore mark.
CASA deposits ratio eases: The CASA deposits of the bank jumped 35% YoY to
Rs 23471 crore at end December 2022. The CASA ratio declined to 38.4% at end
December 2022 compared to 39.2% at end December 2021, while declined from 42.3%
a quarter ago.
Strong loan growth: Advances growth was driven by strong growth in disbursements
to Rs 10012 crore in Q3FY2023 from Rs 8605 crore in Q2FY2023 and Rs 8153 crore
in Q3FY2022.
90% of loan book is retail in nature and 93% of the loan book
is Secured.
Investment
book of the bank jumped 36% YoY
to Rs 19270 crore at end December 2022.
Margins ease marginally: The bank has showed 10 bps YoY increase in cost
of deposits to 6.00%, while yield on advances declined 30 bps YoY to 13.40% in
Q3FY2023. NIM has declined 10 bps YoY to 6.20%.
Branch expansion: During the quarter,
the Bank opened 42 new touchpoints (net addition 35) and its physical network
now spread across 1015 touchpoints across 21 states and 3 UTs. The Bank also
established its presence in 2 newer states this quarter namely Andhra Pradesh
and Kerala. ATMs account stood at 489
ATM`s end December 2022.
Book value of the bank stood at Rs 158.1 per share at end December 2022,
while the adjusted book value (net of NNPA and 10% of restructured advances)
was Rs 152.7 per share at end December 2022.
Quarterly Performance
NII rises on strong loan growth: Bank has recorded 42% increase in the interest
earned at Rs 2118.07 crore, while interest expenses increased 43% to Rs 965.34 crore
in Q3FY2023. NII improved 41% to Rs 1152.73 crore in the quarter ended December
2022.
Moderate growth in the core fee income: Bank has posted 7% growth in core fee income to
Rs 287 crore. However, the treasury income declined 13% to Rs 7 crore, allowing 7% rise in the overall non-interest
income to Rs 294.89 crore in the quarter ended December 2022.
Expenses ratio rises: The operating expenses of the bank increased 40%
to Rs 891.91 crore, as other expenses moved up 51% to Rs 426.72 crore, while
employee expenses increased 31% to Rs 465.19 crore in Q3FY2023. Cost to income
ratio increased to 61.6% in Q3FY2023 compared with 58.2% in Q3FY2022. The
Operating Profit increased 21% to Rs 555.71 crore.
Provisions and contingencies decline: The bank has showed 42% decline in provisions to
Rs 32.64 crore. The loan loss provisions declined 28% to Rs 74 crore, while the
bank has written back standard asset provisions of Rs 38 crore and other
provisions of Rs 3 crore.
Effective tax rate declined to 24.9% in Q3FY2023 from 25.0% in Q3FY2022. Net
Profit rose by 30% YoY to Rs 392.83 crore during quarter ended December 2022.
Financial Performance 9MFY2023:
Bank has posted 28% increase in net profit to Rs
1003.29 crore in the nine months ended December 2022 (9MFY2023). The net
interest income increased 40% to Rs 3212.08 crore, while non-interest income
moved up 3% to Rs 701.40 crore, pushing up net total income by 31% to Rs 3913.48
crore in 9MFY2023. The operating expenses increased 50% to Rs 2464.92 crore, while
provision and contingencies dipped 57% to Rs 113.96 crore, allowing profit
before tax to increase 25% to Rs 1334.60 crore in 9MFY2023. The cost-to-income
ratio jumped to 63.0% in 9MFY2023 compared to 55.3% in 9MFY2022. An effective
tax rate declined to 24.8% in 9MFY2023 compared to 26.4% in 9MFY2022. The net
profit has increased 28% to Rs 1003.29 crore in 9MFY2023.
Commenting
on the performance, Sanjay Agarwal, MD & CEO, AU Small Finance Bank said,
“Q3’FY23 was another quarter of strong and consistent performance across all
key parameters supported by sustained underlying business momentum and strong
capital base. Despite the challenging environment around inflation and
liquidity, we were able to maintain margins, deliver growth in loan market
share, improve asset quality, focus on productivity while achieving our highest
ever quarterly profits.
Our constant endeavor is to be an
increasingly sustainable Bank and we have recently announced a plethora of
progressive HR policies, some of which are among the industry first like
“Menstrual leave for women employees” and an “AU Forever Pass” for our outgoing
employees. I am also pleased to share that AU has been recognized as a Great
Place to Work for the 3rd consecutive year in a row and has been recognized for
‘Excellence in Corporate Governance’ by Institute of Company Secretaries of
India (ICSI). We recently released our first Sustainability Report which is
externally assured by PwC and marks another step in our sustainability journey.
I believe India is well placed in
the post pandemic world. Our favorable demographics, stable democratic set up,
and increasing impact of technological innovations like India Stack coupled
with structural reforms are helping India emerge as a knowledge and technology
leader in the world. Overall, our Bank is well positioned to capitalize on the
emerging opportunities, and the recent acknowledgment as ‘Best Small Finance
Bank’ by BT-KPMG will inspire us further”.
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AU Small Finance Bank: Results
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Particulars
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2212 (3)
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2112 (3)
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Var %
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2212 (9)
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2112 (9)
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Var %
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2203 (12)
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2103 (12)
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Var %
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Interest Earned
|
2118.07
|
1496.45
|
42
|
5930.56
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4254.70
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39
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5921.73
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4950.05
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20
|
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Interest Expended
|
965.34
|
676.03
|
43
|
2718.48
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1957.13
|
39
|
2687.61
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2584.61
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4
|
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Net Interest Income
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1152.73
|
820.42
|
41
|
3212.08
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2297.57
|
40
|
3234.12
|
2365.44
|
37
|
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Other Income
|
294.89
|
275.64
|
7
|
701.40
|
682.32
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3
|
993.69
|
1420.93
|
-30
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Net Total Income
|
1447.62
|
1096.06
|
32
|
3913.48
|
2979.89
|
31
|
4227.81
|
3786.37
|
12
|
|
Operating Expenses
|
891.91
|
637.63
|
40
|
2464.92
|
1647.17
|
50
|
2412.77
|
1658.42
|
45
|
|
Operating Profits
|
555.71
|
458.43
|
21
|
1448.56
|
1332.72
|
9
|
1815.04
|
2127.95
|
-15
|
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Provisions &
Contingencies
|
32.64
|
55.97
|
-42
|
113.96
|
267.75
|
-57
|
360.97
|
669.44
|
-46
|
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Profit Before Tax
|
523.07
|
402.46
|
30
|
1334.60
|
1064.97
|
25
|
1454.07
|
1458.51
|
0
|
|
Provision for tax
|
130.24
|
100.42
|
30
|
331.31
|
281.20
|
18
|
324.24
|
287.82
|
13
|
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PAT
|
392.83
|
302.04
|
30
|
1003.29
|
783.77
|
28
|
1129.83
|
1170.69
|
-3
|
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EPS*(Rs)
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23.6
|
18.1
|
|
20.1
|
15.7
|
|
17.0
|
17.6
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|
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Adj BV (Rs)
|
152.7
|
103.0
|
|
152.7
|
103.0
|
|
113.2
|
85.7
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* Annualized on current equity of
Rs 665.67 crore. Face Value: Rs 10, Figures in Rs crore
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Source: Capitaline Corporate
Database
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