HDFC Q4 profit rises 18%; provisions double to Rs 3,785 crore

Tata Group, HDFC, M-Cap, News Mobile, News Mobile India

The largest lender bank, HDFC registered a year on year growth of nearly 18% despite an overall slowdown in credit creation.

The total profits grew by 17.72% year on year which amounted to profits worth around 6,927 crores.

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HDFC in a press release said, “During the quarter, there was a considerable slowdown in economic activities following the outbreak of COVID-19. Furthermore, with the government initiating lockdown in the latter half of March, and our strict adherence to social distancing, not only did we see an impact on business volumes – in terms of loan originations, distribution of third party products, and payments product activities, but we also could not optimize our collection efforts, and as a result of which fees/other income were lower by Rs 450 crore.”

The bank witnessed an increase in asset quality, measured by a reduction of 16bp to 1.26% and net NPA declining 12bp to 0.36% by the end of March quarter 2020.

The Net Interest Income of the bank stands at about 15,204 crores and this has seen a growth of 16.15% year on year. This is the difference between interest earned by the bank and interest expanded.

The bank had said that its advances aggregated to Rs 9,93,000 as of March 2020 and this amounted to a steep rise of 21.2% growth compared to the previous quarter financial year.

Provisions and contingencies rose by 24.3% for the quarter and stood at Rs 3,785 crore compared to the previous quarter.

The bank has also decided not to pay any dividends this quarter. This is due to RBI guidelines announced on April 17 which asked banks not to pay dividends until further notice.

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