Ujjivan Small Finance Bank reported an increase in its net profit for the quarter ending June 2023 by 59.7 per cent to 324.07 crore, up from 202.94 crore in the same quarter last year.
During Q1FY24, the bank’s net interest income (NII), which is the difference between interest earned and interest expended, climbed 32.1 per cent YoY to 792.4 crore from 599.7 crore.
Net interest margin (NIM) fell 40 basis points (bps) YoY to 9.2 per cent from 9.6 per cent. Pre-Provision Operating Profit (PPOP) increased 52 per cent YoY to 457.89 crore from 300.56 crore.
“During the quarter, we consciously reduced the excess liquidity which was driving negative carry and pulling our NIMs down. Our credit cost for the quarter was minimal on the back of strong collections. While slippages continue to be under control, NPA recoveries have started to move towards normalization,” said Ittira Davis, MD & CEO, Ujjivan Small Finance Bank.
In terms of asset quality, gross non-performing assets (NPA) as a percentage of gross advances declined to 2.62 per cent in the third quarter from 2.88 per cent the previous quarter.
Net NPA as a percentage of net advances increased modestly in Q1FY24 to 0.06 per cent from 0.04 per cent QoQ.
In absolute terms, gross NPA declined to 596.55 crore in the June quarter from 630.61 crore the previous quarter, but net NPA grew to 12.62 crore from 9.04 crore QoQ.
“Bad debt recoveries continue to be strong; we expect the same to be substantial this fiscal as well albeit lower than FY23. We remain confident of our sub-100 bps credit cost for FY24,” Davis said.
Ujjivan Small Finance Bank’s disbursements during Q1FY24 were at ₹5,284 crore, up 22 per cent YoY. Gross loan book at ₹25,326 crore was up 30 per cent on-year.
In the quarter ended June 2023, the bank’s deposits grew by 45 per cent on-year to ₹26,660 crore. CASA grew 27 per cent YoY taking CASA ratio to 24.6 per cent as of June 2023.
