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RBL Bank
RBL Bank

RBL Bank says well capitalized, quashes rumours of crisis

  • The bank is adequately capitalized with a capital adequacy ratio of 16.08%
  • The bank continued to attract additional deposits from retail, corporates

NEW DELHI: RBL Bank on Wednesday dismissed reports that it could be the next to face a crisis after Yes Bank, saying it is financially strong, well capitalized, profitable and a growing entity with a strong governance setup.

"The Bank remains adequately capitalized with a capital adequacy ratio of 16.08% with Tier-1 at 15.02% (Significantly higher than the prescribed regulatory requirement at 11.5% and 9.5% respectively)," RBL said in a notification to the exchanges.

There had been no material adverse change in the asset quality since it announced its December quarter results on 22 January and its guidance remains consistent, the bank added.

"Our Liquidity Coverage Ratio (LCR) is at 145% of statutory requirements as at the end of last week... All our business segments are doing well, we continue to expand presence across newer geographies by adding branches and are also hiring more people as previously planned," it added.

The bank claimed it continued to attract additional deposits from retail, corporates and institutional segments and the management was fully committed to taking the lender to the next level and that its growth journey remains intact.

"We wish to re-emphasize that RBL Bank is a fundamentally strong institution. Rumors around financial health and stability of the institution especially in social media seem to be misplaced, motivated and not based on fact," RBL said.

RBL Bank reported a 69% year-on-year decline in its net profit to 70 crore for the three months ended December, largely because of a surge in provisions.

The bank’s total provisions almost quadrupled year-on-year to 638 crore in Q3 FY20. Sequentially, provisions rose 20% from 533 crore in the September quarter.

Shares of RBL were trading at 233.45 on the BSE, up 12.3% from previous close, even as the benchmark Sensex was marginally higher.

On 6 March, RBI announced a draft rescue plan for Yes Bank, after SBI expressed its willingness to invest in the troubled lender. The plan was released a day after RBI imposed a moratorium on Yes Bank, restricting withdrawals to 50,000 per account till 3 April.

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