Informist, Friday, Jul. 18, 2025

NEW DELHI - Bandhan Bank Friday reported the worst year-on-year fall in its net profit for the quarter ended June in five quarters as provisions jumped. The Kolkata-based bank's net profit fell 65% on year to INR 3.72 billion. Sequentially, however, the net profit rose 17%.

Despite a sharp on year fall in the net profit, Bandhan Bank's bottom line for Apr-Jun was higher than analysts' estimate of INR 3.45 billion. Shares of the bank Friday closed 1.0% higher at INR 187.02 on the National Stock Exchange. The lender detailed its financial results after market hours.

Provisions jumped 119% on year, the most in five quarters, to INR 11.47 billion during Apr-Jun. The interest income fell 1% on year to INR 54.76 billion during Apr-Jun. This was the first on year fall in interest earned since Jul-Sept 2021, and the worst performance since the bank was listed on the exchanges in 2018.

Bandhan Bank's asset quality worsened during the June quarter. The gross non-performing asset ratio rose to 4.96% as of Jun. 30 from 4.71% a quarter ago and 4.23% a year ago. The net non-performing asset ratio also rose to 1.36% as of end-June from 1.28% a quarter ago and 1.15% a year ago. The provision coverage ratio as of Jun. 30 was 73.7%. Including write-offs, the ratio was 87.3% at the end of June.

The bank's credit costs rose 184 basis points on year to 3.5%, but down 43 bps on quarter. Fresh slippages in the reporting quarter rose to INR 15.5 billion from INR 8.9 billion a year ago. Recoveries and upgrades inched lower to INR 3.2 billion from INR 3.7 billion a year ago. The bank had reported fresh slippages of INR 17.5 billion for Jan-Mar, and recoveries and upgrades at INR 3.5 billion.

The net interest income for Apr-Jun was INR 27.57 billion, lower than INR 29.87 billion a year ago. Analysts had projected Bandhan Bank's net interest income for the June quarter at INR 26.84 billion. The net interest margin for Apr-Jun fell to 6.4% from 6.7% a quarter ago.

The bank's total income for the June quarter rose 2% year-on-year, the slowest rise in nine quarters, to INR 62.01 billion. Total expenses grew 9% on year during Apr-Jun, the slowest rise in 15 quarters, to INR 45.33 billion. The slower rise in total expenses was because of a 14-quarter low growth of 6.6% in interest expended to INR 27.18 billion.

Bandhan Bank's gross advances rose 6.4% on year but fell 2.5% on quarter to INR 1.34 trillion as of Jun. 30. Deposits grew 16.1% on year to INR 1.55 trillion as on end-June. The current account savings account ratio was 27.1% as of Jun. 30, down 630 bps on year and 430 bps on quarter.

The share of the entrepreneurs segment, which focuses on microloans, moderated to 25.2% of the total loan book as of end-June from 26.3% a quarter ago. Small business and agricultural loans accounted for 14.3% of the total loan book, down from 14.9% as of Mar. 31. The bank's capital adequacy ratio was 19.08% as of Jun. 30, against 18.71% a quarter ago. End

Edited by Vandana Hingorani

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