HDFC Bank Q3 profit jumps 12 pc to Rs 19,807 cr powered by non-core income

Mumbai, Jan 17 (PTI) HDFC Bank's on Saturday posted a 12.17 per cent rise in consolidated profit to Rs 19,807 crore for the December quarter, powered by a faster growth in non-interest income.

The city-headquartered lender had reported a consolidated net profit of Rs 17,657 crore in the year-ago period and Rs 19,611 crore in the preceding September quarter.

On a standalone basis, the net profit of the country's largest private sector lender increased 11.46 per cent to Rs 18,653.75 crore for the October-December period.

The core net interest income grew 6.4 per cent to Rs 32,600 crore, while the non-interest income came at Rs 13,250 crore on the back of a 11.9 per cent growth in advances and the net interest margin coming at 3.35 per cent.

The other income grew over 15 per cent to Rs 13,254 crore during the quarter, helping drive the profit growth for the city-headquartered lender.

The bank's Chief Financial Officer, Srinivasan Vaidyanathan, told reporters that the bank's credit-deposit ratio has risen during the quarter, but asked everybody to not look at the number on a quarter-to-quarter basis and instead look at it from a long-term perspective.

The key ratio will go down to below 90 per cent over a period of time, he said, adding that the bank is on track to achieve its aim of getting the credit growth at par with the system in FY26 and outpace the system in FY27.

Implementation of the new labour codes led to an impact of Rs 800 crore in expenses for the bank during the quarter.

The overall provisions declined to Rs 2,838 crore during the reporting quarter as against Rs 3,154 crore in the year-ago period, contributing more to the bottomline growth.

The gross non-performing assets ratio declined to 1.24 per cent as against 1.58 per cent in the year-ago period, and were under 1 per cent if one were to exclude stress in the agricultural loan portfolio which delivers higher stress in the third quarter, the CFO said.

Retail loans grew 6.9 per cent during the quarter, small and mid-market enterprises grew 17.2 per cent and wholesale advances jumped by 10.3 per cent.

The bank decreased its exposure to the two-wheeler loans during the three months, and seemed to be cautious on auto and agri loans.

The bank has added over 500 branches over the last 12 months to take its number to over 9,616, and Vaidyanathan said it will keep adding to the number going ahead as well.

He said the bank has a 6 per cent market share on branches and would like it to grow, especially given the fact that every branch contributes Rs 306 crore to the deposit base -- the highest in the industry.

The total number of employees declined nearly 5,000 to 2.15 lakh people during the quarter.

From a capital adequacy perspective, its total capital adequacy ratio was at 19.9 per cent with the tier-I at 17.8 per cent. PTI AA TRB