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MUMBAI : Consumer financier Bajaj Finance Ltd on Tuesday reported an 85% year-on-year (y-o-y) rise in consolidated net profit to 2,125 crore for the three months to December, owing to higher interest income.

Net interest income (NII) increased 40% to 6,000 crore in the December quarter of FY22, as against 4,296 crore in Q3 of the previous financial year. Interest income reversal for the quarter was 241 crore as compared to 450 crore in Q3 FY21. To be sure, the company said that the financials are not strictly comparable on a year-on-year (y-o-y) basis due to dislocation caused by the pandemic last year.

In Q3 FY22, Bajaj Finance said it clocked the highest-ever core assets under management (AUM) growth of 14,700 crore in a quarter. Its AUM as on 31 December 2021 was up 26% at 1.81 trillion, as against 1.43 trillion as on 31 December 2020.

 “(The) AUM composition remained steady. So far in January, there is no impact on business momentum. If the third wave does not create disruption, (the) company expects Q4 and full year AUM growth to remain strong," it said in a regulatory filing.

It added that competitive intensity across products has increased rapidly post the second covid-19 wave and so far, it has been able to protect its margin profile across businesses. Its cost of funds has further reduced to 6.72% in Q3 FY22 as compared to 6.77% in Q2 FY22.

In Q3, Bajaj Finance raised 2,722 crore of NCDs in three years and above tenor, including 2,117 crore raised in 10 year and above tenor. Its liquidity buffer was at 14,400 crore as on 31 December 2021 and expects it to normalize to 11,000 crore levels by the March quarter of FY22.

The lender’s gross non-performing assets and net non-performing assets stood at 1.73% and 0.78% respectively, as on 31 December, as against 2.45% and 1.1% as on 3o September. Its provisioning coverage ratio stood at 56% on stage 3 assets and 156 basis points (bps) on stage 1 and 2 assets as of 31 December.

“During the quarter, the company has changed its NPA classification criteria from number of equated monthly instalment (EMI) outstanding to days-past-due approach in line with the RBI circular dated 12 November 2021. This change did not have any negative impact on the company’s NPA," it said.

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