During the quarter ended 30 September 2023, the bank received income tax orders relating to matter under appeal resulting in write-back of tax provision for earlier years of Rs 222.92 crore (pre-tax of Rs 297.89 crore). The bank has used this amount to build contingent buffers of 100bps created on credit card & microfinance advances to prudently build reserves and strengthen the balance sheet; amounting to Rs 252 crore.

The bank's total income climbed 29.40% YoY to Rs 3712.39 crore during the quarter. Net interest income grew 26% to Rs 1,475 crore in the second quarter of FY24. NIM was 5.54% vs 5.02% for Q2 FY23. Operating profit grew 43% YoY and 13% QoQ to Rs 731 crore in Q2FY24.

Provisions (other than tax) and contingencies steeply higher 165.1% to 640.35 crore in Q2 FY24 from Rs 241.50 crore in Q2 FY23.

On the asset quality front, the bank's gross non-performing assets (NPAs) stood at Rs 2440.66 crore as on 30 September 2023 as against Rs 2404.25 crore as on 30 June 2023 and Rs 2456.60 crore as on 30 September 2022.

The ratio of gross NPAs to gross advances was at 3.12% as on 30 September 2023 compared with 3.22% as on 30 June 2023 and 3.80% as on 30 September 2022.

The ratio of net NPA to net advances stood at 0.78% as on 30 September 2023 as against compared with 1% as on 30 June 2023 and 1.26% as on 30 September 2022.

As on 30 September 2023, total deposits stood at Rs 89,780 crore (up 13% YoY) and net advanced aggregated to Rs 76,324 crore (up 21% YoY). The bank's CASA deposits increased by 12% YoY and 1% QoQ to Rs 320.89 crore in Q2 FY24. While CASA ratio reduced to 35.7% in Q2 FY24 as compared to 36.2% in same quarter last year.

Capital Adequacy Ratio (CRAR) was at 17.07% as on 30 September 2023 as compared with 17.37% recorded on 30 September 2022. The bank's return on assets (ROA) as on 30 September 2023 stood at 1.00% as against 0.77% as on 30 September 2022.

Commenting on the performance, R Subramaniakumar, MD & CEO, RBL Bank said "We are happy to announce yet another quarter of improving operating performance. The advances growth was healthy with strong growth in retail segment. Our revenue has grown at healthy pace; operating expenses are stable sequentially, driven by continued cost optimisation. In order to further strengthen the balance sheet and build buffers proactively, we have taken contingent provision on our credit card & microfinance portfolio. We are also pleased with the progress we are making on cross sell opportunity, within the large card and liability base we have, and we expect this to accelerate further going forward."

RBL Bank is one of India's leading private sector banks with an expanding presence across the country. The bank offers specialized services under five business verticals namely: corporate & institutional banking, commercial banking, branch & business banking, retail assets and treasury and financial markets operations. As of 31 March 2023, the bank has 517 bank branches and 1,166 business correspondent branches, of which 298 are banking outlets.

The shares of the RBL Bank shed 0.85% to settle at Rs 243.65 on Friday, 20 October 2023.