Axis Bank posts net profit of Rs 1,683 cr in Q2

Axis Bank on Wednesday reported a net profit of Rs 1,683 crore on a standalone basis for the quarter ended September on account of a decline in bad loans.

The private sector lender had posted a loss of Rs 112.08 crore in the corresponding July-September period of the previous fiscal.

The bank's total income rose marginally to Rs 19,870.07 crore in the second quarter of 2020-21, from Rs 19,333.57 crore in the same period last year, it said in a regulatory filing.

The bank showed improvement on the asset quality front, with gross non-performing assets (NPAs) falling to 4.18 per cent of gross advances at the end of September 2020, from 5.03 per cent a year ago.

Net NPAs too declined to 0.98 per cent as against 1.99 per cent earlier.

As a result, specific loan loss provisions for the quarter stood at Rs 588 crore, compared to Rs 2,701 crore in the year-ago period.

"The bank held additional provisions of around Rs 6,898 crore towards various contingencies at the end of the first quarter of the current fiscal and also made incremental provisions of Rs 1,279 crore towards loans under moratorium and Rs 1,864 crores towards probable restructuring, aggregating to Rs 3,143 crore," it said.

As of September 30, Axis Bank's provision coverage, as a proportion of gross NPAs, stood at 77 per cent, as compared to 62 per cent at the end of the second quarter of FY20.

During the quarter, the bank raised additional equity capital through a qualified institutional placement (QIP) of 23,80,38,560 shares at a price of Rs 420.1 0 per share, aggregating to Rs 10,000 crore.

As a consequence, the paid-up share capital of the bank has increased by Rs 47.61 crore and the reserves have increased by Rs 9,915.37 crore after charging off issue related expenses, it said.