IDFC First Bank Q4 profit hits record high of ₹803 cr, to raise ₹5,000 cr funds
IDFC First Bank garnered a strong Q4FY23 with highest ever quarterly net profit and robust growth in net interest income (NII). The lender is confident in delivering strong financial performance here on.
PremiumIDFC First Bank witnessed strong growth in earnings for the fourth quarter of FY23. The lender's net profit in Q4FY23 more than doubled to ₹803 crore which is the highest ever in a quarter, while recording double-digit growth in net interest income (NII). At the bank, customers' deposits and loan books stood strong.
In Q4FY23, the bank's net profit skyrocketed by 134% to ₹803 crore as against a profit of ₹343 crore in Q4 of the previous fiscal. Overall, in FY23, PAT jumped by multi-fold to ₹2,437 crore versus a meager ₹145 crore in FY22.
V Vaidyanathan, Managing Director and CEO, of IDFC FIRST Bank, said, "We have registered our highest ever quarterly profit of ₹803 crore in Q4 FY 23 and highest ever yearly profit of ₹2,437 crore in FY23."
Furthermore, NII grew 35% YOY from ₹2,669 crore in Q4-FY22 to ₹3,597 crore in Q4-FY23. For the year, NII climbed by 30% YoY to ₹12,635 crore versus ₹9,706 crore in FY22.
Between January to March 2023 period, the bank posted trading gains of ₹216 crore and it utilized ₹79 crore to increase the provision coverage ratio. Adjusting for these one-time items, the net profit of the bank would have been ₹701 crore for Q4-FY23. The Core ROE on this basis would have been 12.3% which has increased from an ROE of 6.67% for Q4 FY 22.
IDFC First's MD added, “We have built a strong foundation for the bank with a diversified customer deposits and diversified loan book."
As of March 31, 2023, the bank's customer deposits soared by 47% to ₹1,36,812 crore as against ₹93,214 crore as of March 31, 2022. Loans and advances increased by 24% to ₹1,60,599 crore as of March 31, 2023, as against ₹1,29,051 crore as of March 2022 end.
Gross NPA sharply declined to 2.51%, improving by 119 bps year-on-year. Meanwhile, net NPA bettered by 67 bps to 0.86% by the end of Q4FY23 as compared to 1.53% in the same period a year ago.
Vaidyanathan added, "More importantly, I’m happy to share that the asset quality remains high. On the retail side, the Gross NPA is 1.65% and the net NPA is at 0.55%, against the guidance of Gross NPA of 2.0% and NNPA of less than 1%. If we exclude the infrastructure financing book, which is anyway in run-down mode, the Gross NPA and Net NPA would be 1.84% and 0.46% at the overall bank level."
Now the bank is firmly into profits, and Vaidyanathan added, "We believe we can deliver strong financial performance from here on. The Bank would continue to focus on building a strong culture of customer friendliness, customer service, ethics, and high levels of corporate governance in the bank."
In a meeting held on Saturday, IDFC First Bank's board members approved to borrow funds by issue of debt instruments including but not limited to unsecured, redeemable, non-convertible debentures, bonds, or such other debt securities, as may be permitted under RBI guidelines from time to time, through private placement mode, in one or more tranches.
This fundraising through debt securities issuance will be to the tune of ₹5,000 crore.
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