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Federal Bank has reported 11% growth
in net profit at Rs 1056.69 crore for the quarter ended September 2024
(Q2FY2025). The bank has posted healthy 15% growth in net interest income
(NII), while the core fee income of the bank also improved 26% in Q2FY2025. The
Net Interest Margin (NIM) of the bank eased to 3.12% in Q2FY2025 compared to
3.22% in the corresponding quarter of previous year.
On business front, the bank as has
posted 14% growth in business with 13% rise in loan book. The asset quality of
the bank was stable in Q2FY2025. Bank has reduced the credit to deposit ratio
to 87.3% at end September 2024 from 89.5% at end September 2023. CASA ratio of
the bank has declined to 30.1% at end September 2024 from 31.2% at end September
2023.
Asset quality improves: The bank has improved asset quality
in Q2FY2025.
The fresh slippages of loans stood
at Rs 434 crore in Q2FY2025 compared with 424 crore in previous quarter and Rs
373 crore in the corresponding quarter last year.
The recoveries and upgradations of
NPAs stood at Rs 272 crore, while the write-off of loans was at Rs 16 crore in
Q2FY2025.
The standard restructured loan book
of the bank declined to Rs 1637 crore end September 2024.
Provision coverage ratio was steady at
71.82% at end September 2024 compared to 70.79% a quarter ago and 71.03% a year
ago.
The capital adequacy ratio of the
bank stood at 15.2% with Tier I ratio at 13.82% at end September 2024.
The risk weighted assets of the bank
has increased 8% YoY to Rs 197135 crore end September 2024,
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Asset Quality
Indicators: Federal Bank
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Sep-24
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Jun-24
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Mar-24
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Dec-23
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Sep-23
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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)
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4884.49
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4738.35
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4528.87
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4628.79
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4436.05
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3
|
8
|
10
|
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Net NPA (Rs Crore)
|
1322.29
|
1330.44
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1255.33
|
1284.37
|
1229.81
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-1
|
5
|
8
|
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% Gross NPA
|
2.09
|
2.11
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2.13
|
2.29
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2.26
|
-2
|
-4
|
-17
|
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% Net NPA
|
0.57
|
0.60
|
0.60
|
0.64
|
0.64
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-3
|
-3
|
-7
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% PCR
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71.82
|
70.79
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71.08
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71.08
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71.03
|
103
|
74
|
79
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% CRAR - Basel III
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15.20
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15.57
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16.13
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15.02
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15.50
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-37
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-93
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-30
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% CRAR - Tier I -
Basel III
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13.82
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14.17
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14.61
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13.48
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13.79
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-35
|
-79
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3
|
|
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 14% YoY to Rs 503939 crore end September 2024, driven by 13% surge in
advances to Rs 234832 crore. Deposits jumped 16% to Rs 269107 crore at end
September 2024.
CASA deposits ratio declines: The CASA deposits of the bank
increased 11% YoY to Rs 80923 crore at end September 2024. The current account
deposits increased 16% to Rs 16423 crore, while saving account deposits moved
up 8% to Rs 61461 crore end September 2024. The CASA ratio declined to 30.1% at
end September 2024 compared to 31.2% at end September 2023. The term deposits
have increased 24% to Rs 188184 crore end September 2024.
Strong loan growth: Advances growth was driven by retail
loans rising 8% YoY to Rs 97212 crore at end September 2024, agriculture 14% to
Rs 8027 crore and MSME 29% to Rs 27146 crore at end September 2024. The
corporate credit has also moved up 14% to Rs 102447 crore end September 2024.
Investment book of the bank expanded
17% YoY to Rs 64662 crore at end September 2024.
Margins ease: The bank has showed 34 bps YoY
increase in cost of deposits to 5.86%, while yield on advances was flat YoY at 9.35%
in Q2FY2025. Thus, the NIM has declined 10 bps YoY to 3.12%.
Branch expansion: The bank has added 15 branches and
11 ATMs in Q2FY2025, taking overall tally to 1533 branches and 2052 ATM`s end
September 2024.
Book value of the bank stood at Rs 128.3 per
share at end September 2024, while the adjusted book value (net of NNPA and 10%
of restructured advances) was Rs 122.2 per share at end September 2024.
Quarterly Performance
NII rises on healthy loan growth: Bank has recorded 21% increase in
the interest earned at Rs 6577.28 crore, while interest expenses increased 24%
to Rs 4210.05 crore in Q2FY2025. NII improved 15% to Rs 2367.23 crore in the
quarter ended September 2024.
Healthy growth in the core fee
income: Bank has posted
strong 26% growth in core fee income to Rs 726 crore, while the treasury income
surged 157% to Rs 180 crore, leading to 32% jump in the overall non-interest
income to Rs 963.95 crore in the quarter ended September 2024. The forex income
dipped 29% to Rs 58 crore
Expenses ratio rises: The operating expenses of the bank
increased 21% to Rs 1765.82 crore, as other expenses moved up 18% to Rs 988.15
crore, while employee expenses increased 24% to Rs 777.67 crore in Q2FY2025.
Cost to income ratio rose slightly to 53.0% in Q2FY2025 compared with 52.5% in
Q2FY2024. Operating Profit increased 18% to Rs 1565.36 crore.
Provisions and contingencies rises: The bank has showed 261% increase in
provisions to Rs 158.35 crore. The loan loss provisions surged 175% to Rs 168
crore and standard asset provisions rose to Rs 11 crore. However, the bank has
written back investment provisions of Rs 5 crore and other provisions of Rs 16
crore.
Effective tax rate declined
to 24.9% in
Q2FY2025 from 25.5% in Q2FY2024. Net Profit rose by 11% YoY to Rs 1056.69 crore
during quarter ended September 2024.
Financial Performance H1FY2025:
Bank has posted 14% increase in net
profit to Rs 2066.22 crore in the half year ended September 2024 (H1FY2025).
The net interest income increased 17% to Rs 4659.21 crore, while non-interest
income moved up 28% to Rs 1879.13 crore, pushing up net total income by 20% to
Rs 6538.34 crore in H1FY2025. The operating expenses increased 24% to Rs
3472.07 crore, while provision and contingencies galloped 52% to Rs 302.62
crore, allowing profit before tax to increase 14% to Rs 2763.65 crore in
H1FY2025. The cost-to-income ratio rose to 53.1% in H1FY2025 compared to 51.7%
in H1FY2024. An effective tax rate declined to 25.2% in H1FY2025 compared to
25.5% in H1FY2024. The net profit has increased 14% to Rs 2066.22 crore in
H1FY2025.
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Federal Bank: Results
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Particulars
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2409 (3)
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2309 (3)
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Var %
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2409 (6)
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2309 (6)
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Var %
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2403 (12)
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2303 (12)
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Var %
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Interest Earned
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6577.28
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5455.28
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21
|
12908.16
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10479.81
|
23
|
22188.26
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16803.63
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32
|
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Interest Expended
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4210.05
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3398.86
|
24
|
8248.95
|
6504.80
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27
|
13894.78
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9571.47
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45
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Net Interest Income
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2367.23
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2056.42
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15
|
4659.21
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3975.01
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17
|
8293.48
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7232.16
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15
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Other Income
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963.95
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730.42
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32
|
1879.13
|
1462.83
|
28
|
3079.27
|
2330.00
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32
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Net Total Income
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3331.18
|
2786.84
|
20
|
6538.34
|
5437.84
|
20
|
11372.75
|
9562.16
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19
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Operating Expenses
|
1765.82
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1462.39
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21
|
3472.07
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2811.04
|
24
|
6198.27
|
4767.77
|
30
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Operating Profits
|
1565.36
|
1324.45
|
18
|
3066.27
|
2626.80
|
17
|
5174.48
|
4794.39
|
8
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Provisions &
Contingencies
|
158.35
|
43.90
|
261
|
302.62
|
199.48
|
52
|
196.10
|
749.89
|
-74
|
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Profit Before Tax
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1407.01
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1280.55
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10
|
2763.65
|
2427.32
|
14
|
4978.38
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4044.50
|
23
|
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Provision for tax
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350.32
|
326.73
|
7
|
697.43
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619.76
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13
|
1257.78
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1033.91
|
22
|
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PAT
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1056.69
|
953.82
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11
|
2066.22
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1807.56
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14
|
3720.60
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3010.59
|
24
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EPS*(Rs)
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17.2
|
15.6
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|
16.8
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14.7
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|
15.3
|
12.4
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Adj BV (Rs)
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122.2
|
105.6
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|
122.2
|
105.6
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|
113.4
|
94.6
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* Annualized on current equity of
Rs 490.52 crore. Face Value: Rs 2, Figures in Rs crore
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Source: Capitaline Corporate
Database
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