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Mumbai: IDFC First Bank on Saturday reported a 168% jump in net profit for the quarter ended March on account of lower provisions and higher net interest income.

The private sector lender reported a net profit of 342 crore for March quarter as against 127.81 crore a year ago.

The core interest income or net interest income (NII) grew by 36% YoY to 2,669 crore in Q4 FY22 as compared to 1,960 crore during the corresponding period a year ago.

Net interest margin improved to 6.27% during the fourth quarter from 5.9% in the previous quarter.

Other income which includes fees and commission during the quarter rose by 40% to 841 crore from 600 crore in the same period of the previous fiscal.

The bank’s asset quality improved as gross non-performing assets (NPAs) or bad loans reduced to 3.7% of the gross advances as of March 31, 2020 as against 3.96% by the same period a year ago.

Similarly, the net NPA improved to 1.53% during the fourth quarter from 1.74% in the third quarter of previous fiscal.

During the quarter the bank set aside lower funds with provisions falling by 36% YoY to Rs. 369 crore as compared to Rs. 580 crore in Q4-FY21.

Operating expense grew 24% YoY at 2,674 crore for Q4 FY22 as compared to 2,156 crore for Q4 FY21 on account of increased business, said the bank in a regulatory filing.

Deposits rose by 13% year on year to 93,214 crore. Loan book grew by 13% driven by retail loans which saw a growth of 28% YoY to Rs. 83,740 crore at the end of 31 March 2022.

“For the first three years after merger, we grew the retail deposits base (3 year CAGR of 72%), and slowed down the loan growth (3 year CAGR only 6%) to strengthen the foundation. Now that our CASA is ~50%, we can comfortably grow our loan book between 20- 25% compounded for the next three years. This will give us strong operating leverage and growth and profitability. Our capital adequacy is strong at 16.74%," said V Vaidyanathan, managing director and chief executive officer, IDFC First Bank

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