Net profit for the quarter ended December 31, 2022 decreased to 2.91 billion rupees ($35.85 million) from 8.59 billion rupees a year earlier, as provisions and contingencies increased by 91%.
Higher provisions for distress loans also pushed credit costs to 6.4% in the quarter from 3.7% a year earlier.
Creditor asset quality improved slightly, with non-performing loans as a share of total loans at 7.15%, compared to 7.19% in the September quarter.
“In terms of asset quality and pressure, we see the worst is behind us and expect overall business momentum to remain strong from Q4 FY23 (fourth quarter of fiscal 2023),” said Chandra CEO Managing Director and CEO Shekhar Ghosh.
Loans in India have accelerated in recent months as pandemic restrictions eased and the economy reopened.
However, Bandhan Bank’s loan growth slowed sequentially to just over 11%, lagging behind its competitors.
The Kolkata-headquartered bank, which previously focused on providing “microloans” to low-income people, mainly in the eastern states of India, has been looking to expand its reach into the retail and housing sectors.
Net interest income, the difference between interest earned and paid, fell 2.1% to 20.80 billion rupees, while net interest margin, the main measure of profitability, fell to 6.5% compared to 7.8% a year ago.
($1 = 81.1800 Indian rupees)
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