The Board of Directors of IDFC FIRST Bank, in its meeting held today, approved the unaudited financial results for the quarter ended June 30, 2024.
Deposits & Borrowings
Total Deposits of the Bank increased by 35.8% YOY from Rs. 1,54,427 crore as of June 30, 2023 to Rs. 2,09,666 crore as of June 30, 2024.
Customer Deposits increased by 37.8% YOY from Rs. 1,48,474 crore as of June 30, 2023 to Rs. 2,04,572 crore as of June 30, 2024.
CASA Deposits grew by 36.1% YOY from Rs. 71,765 crore as of June 30, 2023 to Rs. 97,692 crore as of June 30, 2024.
CASA Ratio stood at 46.6% as of June 30, 2024.
Retail Deposits grew by 43.5% YOY from Rs. 1,14,272 crore as of June 30, 2023 to Rs. 1,64,001 crore as of June 30, 2024.
Retail Deposits constitutes 80.2% of total customer deposits as of June 30, 2024.
Legacy High Cost Borrowings reduced from Rs. 16,055 crore as of June 30, 2023 to Rs. 10,084 crore as of June 30, 2024.
The Bank opened 11 new branches during Q1 FY25 to reach branch count of 955 by June 30, 2024.
Loans and Advances
Loans and Advances (including credit substitutes) increased by 22.0% YOY from Rs. 1,71,578 crore as of June 30, 2023 to Rs. 2,09,361 crore as of June 30, 2024.
The Bank continues to wind down infrastructure financing as per the stated strategy and now constitutes only 1.3% of total funded assets as of June 30, 2024.
Exposure to top 20 single borrowers improved from 7.0% as of June 30, 2023 to 5.4% as of June 30, 2024.
Credit to Deposit Ratio improved from 107.3% as of June 30, 2023 to 98.1% as of June 30, 2024.
Incremental Credit to Deposit ratio between June 30, 2023 to June 30, 2024 was 72.1%.
Assets Quality
Gross NPA of the bank has improved from 2.17% as of June 30, 2023 to 1.90% of June 30, 2024, improved by 27 bps on YOY basis.
Net NPA of the bank has improved from 0.70% as of June 30, 2023 to 0.59% of June 30, 2024, improved by 11 bps on YOY basis.
Gross NPA of the Retail, Rural and MSME Finance has improved from 1.53% as of June 30, 2023 to 1.46% as of June 30, 2024, improved by 7 bps on YOY basis.
Net NPA of the Retail, Rural and MSME Finance has improved from 0.52% as of June 30, 2023 to 0.46% as of June 30, 2024, improved by 6 bps on YOY basis.
Excluding the infrastructure financing book, which the Bank is running down, the GNPA and NNPA of the Bank would have been 1.60% and 0.43% respectively as of June 30, 2024.
SMA-1 and SMA-2 in Retail, Rural and MSME Finance portfolio continues to be low at 1.01%, but increased from 0.85% as of March 31, 2024 due to rise in SMAs of JLG book (due to floods) which increased from 1.26% as of March 31, 2024 to 1.70% as of June 30, 2024.
Provision coverage ratio (excluding technical write-off) of the bank has increased from 68.11% as of June 30, 2023 to 69.38% as of June 30, 2024. Excluding the run-down infrastructure book, PCR was at 73.48% at June 30, 24.
Profitability
Net Interest Income (NII) grew 25% YOY from Rs. 3,745 crore in Q1 FY24 to Rs. 4,695 crore in Q1 FY25.
Net Interest Margin (Gross of IBPC and sell-down) reduced from 6.33% in Q1 FY24 to 6.22% in Q1 FY25.
Fee and Other Income grew by 19% YOY from Rs. 1,341 crore in Q1 FY24 to Rs. 1,595 crore in Q1 FY25.
Core Operating income grew 24% from Rs. 5,086 crore in Q1 FY24 to Rs. 6,290 crore in Q1 FY25.
Operating Expense grew by 21% YOY from Rs. 3,659 crore in Q1 FY24 to Rs. 4,432 crore in Q1 FY25.
Core Operating Profit grew by 30% YOY from Rs. 1,427 crore in Q1 FY24 to Rs. 1,858 crore for Q1 FY25.
Provisions increased 109% YOY from Rs. 476 crore in Q1 FY24 to Rs. 994 crore in Q1 FY25. This was primarily due to rise in provisions of JLG portfolio, impacted by the flood in Tamil Nadu and seasonal impact.
The annualized credit cost as % of average funded assets (gross of IBPC) for Q1 FY25 was 1.90%. Without the impact of JLG book, the annualized credit cost as % of average funded assets for Q1-FY25 was 1.70%. Bank expects the credit cost to get normalized from Q3-FY25 onwards.
Net Profit de-grew 11% YOY from Rs. 765 crore in Q1 FY24 to Rs. 681 crore in Q1 FY25. Excluding trading gains from respective period, the degrowth in profit was at 7% YOY.
Provisions for JLG business was higher by Rs. 132 crores in Q1 FY25 over the Q1 FY 24. Excepting this impact, the PAT for the quarter would have been higher by Rs. 100 crores.
RoA stood at 0.91% and RoE stood at 8.32% in Q1 FY25.
Capital Position
Capital Adequacy including profit for Q1-25 was strong at 15.88% with CET-1 Ratio at 13.34% as on June 30, 2024. Including Capital raised in July 2024, the Capital Adequacy Ratio as on June 30, 2024 would be 17.21%, with CET-1 ratio at 14.67%.
Comments from Managing Director & CEO
Mr. V Vaidyanathan, Managing Director and CEO, IDFC FIRST Bank, said,
“The biggest requirement in Banking today is the ability to raise deposits. On this front, we continue to get strong growth in deposits based on top quality service levels, top in class mobile App, and excellent corporate governance. Our CASA ratio is sustained at 46.6%. Our customer deposits have grown 38% YOY. We thank our customers for their goodwill towards us.
Overall Gross NPA was stable at 1.90% and Net NPA was 0.59%. Provisions normalized this quarter in line with the industry. We took extra provisions for MFI business because of massive floods in Tamil Nadu and because of seasonality. We expect credit cost to normalise in H2 FY25 as guided earlier.
On the profitability front, the Core Operating Profit (Income less Opex) rose 31% YOY excluding trading gains. This continues on the back of strong core Operating Profit in FY24, which was up 31% from Rs. 4,607 crore in FY23 to Rs. 6,030 crore in FY24.”
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