RBL Bank Q4 net dives 34% as provisions on credit cards
Small-sized private lender RBL Bank on Tuesday declared a 34 per cent decline in its March quarter profit to Rs 75 crore which was Rs 114 crore in the year-ago period. This is due to provisioning for possible loan losses that it sees in the retail unsecured segments.
The bank net profit for FY2020-21 rose marginally to Rs 508 crore as compared to Rs 506 crore the year-ago period.
The bank’s core net interest income dipped 11 per cent during the reporting quarter at Rs 906 crore. This is impacted largely by the narrowing of the net interest margin to 4.17 per cent and also a 1 per cent growth in advances in FY21 as it moved away from corporate loans.
The managing director and chief executive of RBL Vishwavir Ahuja explained that there was a 0.50 per cent impact on the net interest margin because of an interesting reversal of Rs 85 crore on account of the Supreme Court order on standstill accounts.
He exuded confidence that the net interest margin trajectory will return to the normal trajectory and the crucial number will be over 4.75 per cent in FY22.
The private lender’s overall provisions increased to Rs 766 crore as against Rs 601 crore in the year-ago period, on account of an additional Rs 70 crore set aside as accelerated provisions for stressed unsecured advances.