RBL Bank Q3 Results: RBL Bank announced its October-December quarter results for fiscal 2024-25 (Q3FY25) on Saturday, January 18, reporting a crash of 86 per cent in net profit to ₹32.6 crore due to significantly higher provisions, compared to ₹233.1 crore in the corresponding period last year.
The private lender’s net interest income (NII)—the difference between interest earned and paid—rose three per cent to ₹1,585 crore in the third quarter of current fiscal, compared to ₹1,546 crore in the year-ago period.
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RBL Bank Q3 Results: Key Metrics
RBL Bank’s asset quality improved marginally in the December quarter. The gross non-performing asset (NPA) ratio rose slightly to 2.92 per cent in the December quarter, compared to 2.88 per cent in the previous quarter, but improved from 3.12 per cent a year ago. The net NPA ratio (bad loans) fell to 0.53 per cent in the quarter under review from 0.79 per cent in the preceding September quarter and 0.80 per cent in the year-ago period.
In absolute terms, gross NPAs increased to ₹2,701 crore as of 31 December 2024 from ₹2,581.08 crore in the preceding quarter. The net NPAs reduced to ₹481.64 crore from ₹697.51 crore during the same period. The net interest margin (NIM) stood at 4.90 per cent. NII rose 10 per cent YoY for the nine-month period to ₹4,900 crore, with NIM at 5.19 per cent.
The quarter’s provisions jumped nearly twofold year over year to ₹1,189 crore, compared to ₹458 crore in the year-ago period. The overall Provision Coverage Ratio, including technical write-offs, stood at 93.46 per cent, while credit cost rose to 139 basis points in the year-ago period. The slippages on the MFI book zoomed to ₹535 crore compared to ₹125-150 crore range due to a host of issues in the history, including over-leverage of borrowers.
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Other income surged 38 per cent year-on-year (YoY) to ₹1,073 crore in Q3FY25, while core fee income increased 19 per cent YoY to ₹871 crore. The total deposits grew 15 per cent YoY to ₹1.07 lakh crore, with Current Account Savings Account (CASA) deposits rising 12 per cent to ₹35,022 crore.
The private bank also recorded an exceptional net gain of ₹144.15 crore from selling a 10 per cent stake in DAM Capital during its IPO. CASA ratio stood at 32.8 per cent, while granular deposits (below ₹3 crore) increased 20 per cent YoY to ₹53,719 crore, forming 50.3 per cent of total deposits.
The bank management said it will take up to two quarters for the NIMs to stabilise and enter into the five per cent territory. The city-based bank’s overall capital adequacy stood at 15.4 per cent as of December 31, 2024, and the bank management said that there are no new fundraising plans.
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Net advances expanded 13 per cent YoY to ₹90,412 crore, with retail advances growing 19 per cent to ₹55,199 crore. The retail-to-wholesale advances ratio stood at 61:39. Housing loans increased 33 per cent YoY, rural vehicle finance rose 30 per cent, and commercial banking advances grew 21 per cent.
The credit card business, where the bank has significant exposure, will also take time to normalise, with net slippages on the book at ₹533 crore.On Friday, shares of RBL Bank settled 2.18 per cent lower at ₹155.10 apiece on the BSE. The bank commands a market capitalisation (mcap) of ₹9,426.80 crore.
“We remain cautious about the short-term challenges emanating from the macro-economic environment affecting certain unsecured lending segments. We continue to demonstrate strong growth in chosen areas of secured retail & commercial banking on the asset side and granular deposits on the liability side,” said R Subramaniakumar, MD & CEO of RBL Bank
“Our core business remains robust and disciplined, focus on growth with profitability, and customer-centric approach continues to drive meaningful progress. Overall, we are happy to deliver yet another quarter of robust operating performance and business growth, ” added Subramaniakumar.
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