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HDFC Bank Q3 FY17 net profit at Rs 3,865.3 cr, up by 15.1% over the quarter ended December 31, 2015

28-January-2017
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HDFC Bank Q3 FY17 net profit at Rs 3,865.3 cr, up by 15.1% over the quarter ended December 31, 2015

The Board of Directors of HDFC Bank Limited approved the Bank’s (Indian GAAP) results for the quarter and nine months ended December 31, 2016.

The Bank’s total income for the quarter ended December 31, 2016 was Rs 20,748.3 crore, up from Rs 18,283.3 crore for the quarter ended December 31, 2015. Net revenues (net interest income plus other income) increased by 15.2% to Rs 11,451.8 crore for the quarter ended December 31, 2016 as against Rs 9,940.7 crore for the corresponding quarter of the previous year. Net interest income (interest earned less interest expended) for the quarter ended December 31, 2016 grew by 17.6% to Rs 8,309.1 crore, from Rs 7,068.5 crore for the quarter ended December 31, 2015, driven by average assets growth of 18.6% and a net interest margin for the quarter of 4.1%. Other income (non-interest revenue) at Rs 3,142.7 crore was 27.4% of the net revenues for the quarter ended December 31, 2016 and grew by 9.4% over Rs 2,872.2 crore in the corresponding quarter ended December 31, 2015.

The four components of other income for the quarter ended December 31, 2016 were fees and commissions of Rs 2,206.8 crore (Rs 2,004.8 crore in the corresponding quarter of the previous year), foreign exchange and derivatives revenue of Rs 297.2 crore (Rs 277.4 crore for the corresponding quarter of the previous year), gain on revaluation / sale of investments of Rs 398.6 crore (Rs 327.9 crore in the corresponding quarter of the previous year) and miscellaneous income including recoveries of Rs 240.0 crore (Rs 262.1 crore for the corresponding quarter of the previous year).

Operating expenses for the quarter ended December 31, 2016 were Rs 4,842.5 crore, an increase of 15.2% over Rs 4,204.8 crore during the corresponding quarter of the previous year. The core cost-to-income ratio for the quarter was 43.8% as against 43.7% for the corresponding quarter ended December 31, 2015. Provisions and contingencies for the quarter ended December 31, 2016 were Rs 715.8 crore (consisting of specific loan loss provisions Rs 694.4 crore, general provisions Rs 9.3 crore, and other provisions Rs 12.1 crore) as against Rs 653.9 crore (consisting of specific loan loss provisions Rs 601.5 crore, general provisions Rs 49.9 crore and other provisions Rs 2.5 crore) for the corresponding quarter ended December 31, 2015. Profit before tax was up 16.0% to Rs 5893.5 crore. After providing Rs 2,028.1 crore for taxation, the Bank earned a net profit of Rs 3,865.3 crore, an increase of 15.1% over the quarter ended December 31, 2015.

As of December 31, 2016, total balance sheet size was Rs 828,020 crore as against Rs 699,797 crore as of December 31, 2015. Total deposits as of December 31, 2016 were Rs 634,705 crore, an increase of 21.1% over December 31, 2015. This was after considering maturities of about US$ 3 billion of Foreign Currency Non-Resident (FCNR) deposits raised (and swapped into rupees with RBI at a concessional rate) during the quarter ended December 31, 2013. CASA deposit growth saw a spurt largely attributable to the demonetisation exercise, with current account deposits growing by 36.7% over the previous year to reach Rs 101,239 crore and savings account deposits growing by 37.8% over the previous year to reach Rs 186,634 crore. Time deposits were at Rs 346,832 crore, an increase of 10.3% over the previous year resulting in CASA proportion of 45% as on December 31, 2016. Total advances as of December 31, 2016 were Rs 495,043 crore after considering repayments of about US$ 2 billion of overseas loans linked to FCNR deposits. The Bank’s domestic loan portfolio of Rs 477,415 crore grew at 17.5% on a year on year basis. As per the Bank’s internal business classification, the domestic retail loans and wholesale loans grew by 17.8% and 16.8% respectively. As per regulatory (Basel 2) segment classification the growth rates were 21.5% for domestic retail loans and 13.0% for wholesale loans. The domestic loan mix as per Basel 2 classification between retail:wholesale was 55:45.

For the nine months ended December 31, 2016, the Bank earned a total income of Rs 60,041.8 crore as against Rs 52,110.6 crore in the corresponding period of the previous year. Net revenues (net interest income plus other income) for the nine months ended December 31, 2016 were Rs 32,934.4 crore, as against Rs 28,024.0 crore for the nine months ended December 31, 2015, an increase of 17.5%. Net profit for the nine months ended December 31, 2016 was Rs 10,559.6 crore, up by 18.4% over the corresponding nine months ended December 31, 2015.

The Bank’s total Capital Adequacy Ratio (CAR) as per Basel III guidelines, was at 15.9% as at December 31, 2016 (15.9% as at December 31, 2015) as against a regulatory requirement of 9%. Tier-I CAR was at 13.8% as on December 31, 2016 compared to 13.2% as at December 31, 2015.

Capital Adequacy: The Bank’s total Capital Adequacy Ratio (CAR) as per Basel III guidelines, was at 15.9% as at December 31, 2016 (15.9% as at December 31, 2015) as against a regulatory requirement of 9%. Tier-I CAR was at 13.8% as on December 31, 2016 compared to 13.2% as at December 31, 2015.

Network: As of December 31, 2016, the Bank’s distribution network was at 4,555 branches and 12,087 ATMs across 2,597 cities / towns as against 4,281 branches and 11,843 ATMs across 2,505 cities / towns as of December 31, 2015. Of the total branches, 52% are in semi-urban and rural areas. Number of employees increased from 84,619 as of December 31, 2015 to 90,421 as of December 31, 2016.

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