RBL Bank Profit Dips 76% in Q4: Unsecured Loans Hit
Apr 25, 2025 18:32
RBL Bank's Q4 profit plunged 76% due to losses in unsecured lending, mainly microfinance and credit cards. The bank's net interest margin also contracted.
Photograph: Mahipal Soni/Rediff.com
Mumbai, Apr 25 (PTI) Setbacks in unsecured lending led RBL Bank to report a 76 per cent decline in its consolidated net profit for the January-March quarter at Rs 86.99 crore on a consolidated basis.
The city-based lender had reported a consolidated net profit of Rs 364 crore in the year-ago period and Rs 47 crore in the preceding December quarter.
The overall provisions shot up to Rs 785 crore from the Rs 414 crore in the year-ago period due to troubles in the microfinance and credit card books, and the bank hinted that it may not have to set aside higher sums going ahead.
The core net interest income declined by 2 per cent to Rs 1,563 crore on a 7 per cent growth in net advances and a sharp decline in net interest margin to 4.89 per cent as against 5.45 per cent in the year-ago period. The other income grew 14 per cent to Rs 1,000 crore.
A senior bank official explained that the NIMs will compress for six more months on factors like rate cuts and stabilize at the current level by the end of the current fiscal year.
The bank is targeting a mid-to-high teen growth in advances in the new fiscal, which will include an over 25 per cent increase in retail assets on the back of growth in secured book, and doubling in the wholesale asset growth to 12 per cent, its managing director and chief executive R Subramaniakumar said.
The gross slippages came at Rs 1,058 crore, including Rs 479 crore on the credit card front and Rs 472 crore on the MFI book.
The bank said the entire stock of bad microloans has been provided for, which led to the increase in the provisions for the reporting quarter, and added that 75 per cent of provisions have been done for assets unpaid for over 31 days.
The overall deposit growth came at 7 per cent, and the bank will continue to focus on granularising it, the CEO said.
The overall capital adequacy stood at a comfortable over 15 per cent, and the CEO told reporters that there is no need for raising more resources.
RBL Bank shares closed 5.30 per cent down at Rs 187.8 apiece on BSE on Friday against a 0.74 per cent correction on the benchmark Sensex.
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