RBL Bk Q3 net profit plummets to ₹47 cr on reverses from MFI loans
RBL Bk Q3 net profit plummets to ₹47 cr on reverses from MFI loans
Mumbai, Jan 18 (PTI) RBL Bank's net profit plummeted to ₹47 crore in the December quarter of 2024-25 from ₹245 crore in the year-ago period as the microloan portfolio came to bite.
The city-based private sector lender, which has had difficult few quarters due to higher credit costs, reported a net profit of ₹231 crore in the preceding September quarter.
Its core net interest income grew by 3 per cent to ₹1,585 crore, while the other income grew 38 per cent to ₹1,073 crore aided by a stake sale in the NBFC DAM Capital.
The bank's chief executive and managing director R Subramaniakumar said the net interest margin declined to 4.90 per cent from 5.52 per cent in the year-ago period, and 0.40 per cent of the impact came from the microfinance exposures.
The slippages on the MFI book zoomed to ₹535 crore as against the usual ₹125-150 crore range due to a host of issues in the history including over-leverage of borrowers.
There are some other smaller problems as well like a nationwide campaign which has led to a propensity to not pay up among the borrowers, and also some localised issues like a community in two Karnataka districts being reluctant to pay the dues, he said.
He, however, said that the situation is improving if one were to go by the collection efficiencies which climbed up into the 97 per cent figure in December after being one percentage point lower in the first two months of the quarter.
The bank MD said that it will take up to two quarters more for the situation to normalise in the MFI business, but conceded that its share in the overall book my decline up to 6.5 per cent from over 7 per cent in December, as lending slows down.
Another executive said the credit card business, where the bank has significant exposure, will also take up to normalise, pointing out that net slippages on the book stood at ₹533 crore.
The overall gross non-performing assets ratio climbed up to 2.92 per cent in December from 2.88 per cent in September as a result of the elevated gross slippages of ₹1,309 crore as against ₹666 crore in the year-ago period.
It will take up to two quarters for the NIMs to stabilise and enter into the 5 per cent territory, the bank management said. The bank's overall capital adequacy stood at 15.4 per cent as of December 31, 2024, and the bank management said that there are no new fundraising plans.
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Business NewsCompaniesCompany ResultsRBL Bk Q3 net profit plummets to ₹47 cr on reverses from MFI loans
First Published:18 Jan 2025, 07:58 PM IST
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