IDFC First Bank logs net profit of Rs 94 crore in Q1

IDFC First Bank on Tuesday reported a net profit of Rs 94 crore in the first quarter ended June of the current fiscal year.

The Mumbai-headquartered private sector lender had posted a net loss of Rs 617 crore in the corresponding June quarter of previous fiscal year.

The bank's total income grew 42 per cent to Rs 2,111 crore during April-June period of 2020-21 as compared with Rs 1,485 crore in the same period of 2019-20, IDFC First Bank said in a release.

Provision during Q1 of FY21 stood at Rs 764 crore as compared with Rs 1,281 crore in the year-ago quarter, and at Rs 679 crore in Q4FY20.

"In the first phase of moratorium, the bank took COVID-19 related provision of Rs 225 crore through the profit and loss account in the quarter ended March 31, 2020. During Q1FY21, the bank has created additional COVID-19 provision of Rs 375 crore to further strengthen the balance sheet," it said.

On asset quality, the bank said its gross non-performing assets (NPAs) reduced to 1.99 per cent at the end of June 2020 from 2.66 per cent a year ago.

In absolute value, gross NPAs stood at Rs 1,741.66 crore as against Rs 2,418.56 crore.

Net NPAs or bad loans were down at 0.51 per cent (Rs 436.58 crore) versus 1.35 per cent (Rs 1,215.13 crore) a year ago.

Apart from NPAs, the identified stressed asset pool of the bank reduced by Rs 943 crore during the last financial year.

This stressed pool stood at Rs 3,195 crore as of June 30, 2020 against which the bank has done provisioning of Rs 1,668 crore, 52 per cent of the pool, it said.

"Apart from the NPA and stressed accounts as mentioned, the bank had also marked one large telecom account as stressed and provisioned 50 per cent against the total outstanding of Rs 3,244 crore (funded – Rs 2,000 crore and non-funded – Rs 1,244 crore) in the quarter ending on 31 December 2019," it added.

"The bank continues to carry the same provision for the account as of June 30, 2020."

On Covid-19, it said retail disbursals were significantly impacted, especially during the month of April and May.

However, disbursals revived during June 2020, after relaxations in lockdowns, and have been improving since then.

Capital adequacy of the bank is strong at 15.03 per cent with common equity tier (CET)-1 ratio at 14.58 per cent at end of June 2020 as compared with 13.38 per cent and CET-1 of 13.30 per cent as of March 31, 2020, it said.

The bank raised Rs 2,000 crore fresh equity capital through preferential route during the quarter, it said.

"We continue to progress well on all parameters as per the guidance provided for the bank. Further, we have liberally provided moratorium to customers who sought it, and our moratorium was about 45 per cent last quarter," IDFC First Bank Managing Director and CEO V Vaidyanathan said.

"This has reduced to 28 per cent now, which we expect to fall below 10 per cent by August 31, 2020, based on the strong improving trend in collections we are experiencing," he added.

Shares of IDFC First Bank on Tuesday closed 1.83 per cent higher at Rs 27.85 on the BSE.