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RBL bank has reported 34%, on yoy basis, dip in the net profit to Rs 75.34 crore for the quarter ended March 2021 (Q4FY2021). The performance of the bank has been impacted due to decline in the Net Interest Margin (NIM) on account of sharp decline in credit-deposits ratio and relative higher decline in yield on advances than the decline in cost of funds. The bank has also witnessed increase in provisions in Q4FY2021. However, the bank has posted healthy growth in core fee income and improved cost-to-income ratio in Q4FY2021.
Net Interest Margin (NIM) has declined to 4.2% in Q4FY2021 compared with 4.9% in the corresponding quarter last year. The loan growth of the bank has returned to positive zone at 1% at end March 2021.
Bank has continued to raise Current Account-Saving Account (CASA) deposits ratio to 31.8% at end March 2021 from 31.1% a quarter ago and 29.6% a year ago.
Bank has continued to expand branch network at healthy pace touched the branch network level of 429 branches along with 412 ATMs at end March 2021.
Asset quality shows marginal pressure: Bank has witnessed elevated GNPA and NNPA ratios, while banks restructured advance book has moved up in Q4FY2021.
GNPA ratio stood at 4.34% and NNPA ratio was at 2.12% at end March 2021
Fresh slippages of advances stood at Rs 1439 crore, while bank has recorded recoveries and upgradations of Rs 776 crore and conducted write-offs of Rs 671 crore in Q4FY2021.
Restructured assets book jumped 1.41% of the advances at end March 2021 from 0.9% a quarter ago and 0.08% a year ago.
The securities receipts on the banks book stood at 0.29% at end March 2021.
The provision coverage ratio of the bank stood at 72.2% at end March 2021.
Risk weighted assets moved up 12% to Rs 73948 crore at end March 2021.
| Asset Quality Indicators: RBL Bank |
|
Mar-21 |
Dec-20 |
Sep-20 |
Jun-20 |
Mar-20 |
Variation |
| QoQ |
YoY |
| Gross NPA (Rs Crore) |
2601.53 |
1050.21 |
1911.72 |
1992.07 |
2136.52 |
148 |
22 |
| Net NPA (Rs Crore) |
1241.35 |
402.46 |
775.77 |
932.68 |
1189.37 |
208 |
4 |
| % of GNPA |
4.34 |
1.84 |
3.34 |
3.45 |
3.62 |
250 |
72 |
| % of NNPA |
2.12 |
0.71 |
1.38 |
1.65 |
2.05 |
141 |
7 |
| Provision coverage ratio % |
72.20 |
86.40 |
74.80 |
70.46 |
64.04 |
-1420 |
816 |
| % CRAR - Basel III |
17.50 |
17.33 |
16.09 |
16.14 |
16.45 |
17 |
105 |
| % CRAR - Basel III - Tier I |
16.60 |
17.10 |
15.10 |
15.20 |
11.30 |
-50 |
530 |
| Variation in basis points for figures given in percentages and in % for figures in Rs crore |
Business Highlights:
Business growth jumps on sharp surge in deposits: The business of the bank increased 14% to Rs 131744 crore at end March 2021. Deposits zoomed 26% to Rs 73121 crore, while advances rose 1% to Rs 58623 crore at end March 2021. Credit-deposit ratio of the bank dipped to 80.2% at end March 2021 from 84.0% a quarter ago, while it has plunged from 100.4% a year ago.
Wholesale loans share declines: Corporate or wholesale loans accounted for 41.3% of the advances portfolio, while non-wholesale loans (including retail, micro loans, MSME, and agri) accounted for 58.7% at end March 2021 compared with 47.3%: 52.7% at end March 2020.
The wholesale loans declined 12% to Rs 24233 crore, while non-wholesale loans jumped 13% to Rs 34390 crore end March 2021 over March 2021. Within the non-wholesale loans, microfinance loans surged 11% to Rs 7132 crore end March 2021 over March 2020.
CASA ratio improves: The CASA deposits continued to grow at strong pace of 36% to Rs 23264 crore at end March 2021. CASA ratio further increased to 31.8% at end March 2021 up from 31.1% a quarter ago and 29.6% a year ago.
Margins eases: Bank has witnessed decline in the net interest margin (NIM) to 4.20% in Q4FY2021 from 4.9% in the corresponding quarter last year. Yield on advances declined 130 bps yoy 11.2%, while cost of funds dipped 105 bps yoy to 5.3% in Q4FY2021.
Network expansion: Bank has added 26 new branches during the quarter taking the total branch count to 429 branches at end March 2021. ATMs count of the bank stood at 412 ATMs at end March 2021. Total customer base of the bank has increased to 9.63 million at end March 2021 from 9.08 million a quarter ago and 8.49 million at end March 2020
Book value per share has improved to Rs 211.7 per share at end March 2021, while adjusted book value (adjusting for NNPA and 10% of restructured assets) stood at Rs 189.6 per share.
Quarterly Performance:
NII declines on fall in margins: For the quarter ended March 2021, the bank has reported 11% decline in NII at Rs 906.04 crore. NIM declined to 4.20% in Q4FY2021 from 4.9% in Q4FY2020 supporting the NII growth for Q4FY2021. The interest income fell 13% to Rs 1922.40 crore, while interest expenses declined 14% to Rs 1016.36 crore. The yield on advances declined 130 bps yoy to 11.2%, while cost of funds dipped 105 bps yoy to 5.3% in Q4FY2021.
Healthy non-interest income growth: The non-interest income of the bank increased 38% on yoy basis to Rs 688.43 crore in Q4FY2021. Core fee income improved 40% to Rs 660 crore, while trading income declined 7% to Rs 28 crore in Q4FY2021. Net total income of the bank increased 5% to Rs 1594.47 crore in Q4FY2021.
Stable expense ratio: The operating expenses of bank have declined 7% to Rs 717.94 crore driven by 10% fall in other operating expenses to Rs 510.95 crore in quarter ended March 2021. The employee cost increased 4% to Rs 206.99 crore. The expense ratio eased 89 bps qoq and 555 bps yoy to 45.0% in Q4FY2021.
The operating profit of the bank galloped 17% to Rs 876.53 crore in quarter ended March 2021.
Provisions rises: Provisions and contingencies increased 27% to Rs 766.25 crore for Q4FY2021.
Profit before tax declined 27% to Rs 110.28 crore in Q4FY2021.
An effective tax rate jumped 754 bps yoy to 31.7%. Net Profit dipped 34% to Rs 75.34 crore in quarter ended March 2021.
Financial Performance FY2021:
For the year ended March 2021 (FY2021), the bank has posted nearly flat net profit at Rs 507.78 crore. The net interest income improved 4% to Rs 3787.56 crore, while non-interest income advanced 8% to Rs 2057.84 crore in FY2021. The expense ratio improved 388 bps to 47.1% in FY2021 compared to 51.0% in FY2020. The operating expenses declined 3% to Rs 2754.58 crore, while provision and contingencies jumped 22% to Rs 2401.74 crore. The profit before tax declined 8% to Rs 689.08 crore in FY2021. An effective tax rate has declined to 26.3% in FY2021 from 32.8% in FY2020. The net profit came in flat at Rs 507.78 crore in FY2021.
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