Mumbai: Buoyed by growth in fee, trading and interest income, Citibank NA’s Indian arm on Wednesday reported a 20% increase in net profit to Rs2,173 crore for the fiscal year ended 31 March. Its net profit for the previous fiscal was Rs1,804 crore.
However, the India unit of Citibank saw its net non-performing loans almost double from the earlier fiscal. Such loans, as a percentage of net advances, grew to 2.6% at the end of March, against 1.23% last year.
The quality of retail loans continued to deteriorate, particularly in unsecured lending such as personal loans and credit cards. The bank’s retail banking book grew to Rs22,416 crore against Rs21,557 crore last year.
The bank has already stopped growing its personal loan book to arrest rising delinquencies. However, it will continue to grow its mortgages and credit cards portfolio.
The retail banking business is expected to take another quarter before non-performing loans peak and start to show any downward movement.
Total revenues rose 24% to Rs10,423 crore from Rs8,410 crore last year, the bank said in a press release. The India operation’s balance sheet grew by 26% to Rs1,05,264 crore from Rs83,851 crore. Its provisions for non-performing loans and investments increased to Rs1,588 crore as against Rs664 crore.
The bank’s capital adequacy ratio—or the amount of capital backing its risk assets—stood at about 13%.
The bank’s corporate banking portfolio grew to Rs19,981 crore as compared to Rs18,742 crore. Its deposit base grew to Rs51,677 crore as on March against Rs46,125 crore.
To support its future growth, the bank will largely focus on commercial banking and retail banking. CitiFinancial Consumer Finance India Ltd, the non-banking finance company (NBFC) of the bank, continued to face losses, but the bank did not disclose any financial information on the company as it is still in the process of closing the books.
The parent firm had by 31 March infused $110 million (Rs533.5 crore) in the NBFC for capital adequacy purpose and to support its business.
In June it brought in another around of capital of $90 million.