Advertisement

  • News
  • Columns
  • Interviews
  • BW Communities
  • Events
  • BW TV
  • Subscribe to Print
  • Editorial Calendar 19-20
BW Businessworld

RBL Bank's Net Profit Fell 78% in Q2

Credit cards and microfinance remained the largest contributors to net slippages at Rs 431 crore and Rs 267 crore as the impact of the second wave of the pandemic lingered.

Photo Credit :

1471611109_FwbrLr_RBL5.jpg

RBL Bank’s Net profit fell 78% to Rs 31 crore in the quarter ending September 2021 from Rs 144 crore a year ago largely due to a 5 per cent shrinkage in retail loans and also by a reversal in interest income from segments like microfinance.


Credit cards and microfinance remained the largest contributors to net slippages at Rs 431 crore and Rs 267 crore as the impact of the second wave of the pandemic lingered.
 
 The bank suffered an interest rate reversal of Rs 130 crore during the quarter as loans from microfinance and credit cards slipped. The reversals also impacted the bank's net interest margin (NIM) which fell 28 basis points to 4.06 per cent in September 2021. One basis point is 0.01 percentage point.

CEO Vishwavir Ahuja said he expects the second half of the fiscal to be better than the first as new additions to NPAs slow down, recovery improves and greater economic activity helps loan growth.
 
 Loan book fell 1 per cent compared to the quarter ended June as retail loans shrunk 5 per cent because the bank remained cautious on microfinance loans and was also impacted by the ban on US card company Mastercard imposed on July 14. Net interest income fell 2 per cent to Rs 915 crore.


The loan book also fell 1 per cent compared to quarter ended June due to shrinkage in retail loans by 5 per cent and banks remained cautious on microfinance loans. It was also impacted by the ban on US card company Mastercard imposed by RBI on July 14. Net interest income fell 2 per cent to Rs 915 crore.

Gross NPAs increased to 5.40 per cent from 4.99 per cent in June 2021 and 3.34 per cent a year earlier.
 
 Other income rose 42 per cent led by retail fees though it fell 9 per cent versus June due to a fall in treasury income and a Rs 39 crore fee income reversal.
 
  Ahuja said after a standstill since the July Mastercard ban credit card issuances have also picked up with the bank issuing 1.6 lakh cards in September and expects to top it by issuing 2 lakh new cards in October.

Shares of RBL Bank closed at Rs 180.60 on BSE on Friday, down 10.33 per cent.


Tags assigned to this article:
rbl bank q2 earnings