notes from FINANCIAL RESULTS FOR THE QUARTER ENDED 30th JUNE 2024
Q1FY25 core operating profit of 9,637 crores up 16% YOY,3% QOQ , NIM at 4.05%, cost growth moderating, aided by steady growth in average deposits and advances
• Net Interest Income grew 12% YOY and 3% QOQ
• Fee income grew 16% YOY, Retail fee grew 18% YOY, granular fees at 93% of total fees
•Operating cost growth moderated to 11% YOY and declined sequentially, PAT at 6,035 crores up 4% YOY
•On a QAB, total deposits grew 14% | 3%, term deposits grew 21% | 4%, CASA grew 4%| 3% on YOY | QOQ basis, respectively
•Total advances grew 14% YOY, Retail loans grew 18% YOY, SME grew 20% YOY, Corporate loans grew 6% YOY
•Overall CAR stood at 16.65% with CET 1 ratio of 14.06%, net accretion to CET-1 of 32 bps in Q1FY25
•GNPA% at 1.54% declined by 42 bps YOY, NNPA% at 0.34% declined by 7 bps YOY
MEB deposits grew 13% YOY; CASA ratio at 42%, which is amongst the best for peer private banks
•On MEB basis, term deposits grew 20% YOY, CA grew 12% YOY, SA flat YOY
o Average LCR during Q1FY25 was ~120%, outflow rates improved ~ 400 bps over last 2 years
o ~1 million credit cards issued in Q1, CIF market share4 of ~14%, card spends up ~12% YOY
o Largest player in Merchant Acquiring with market share of 21%, incremental share of 45% in last one year4
o Citi integration completed successfully in July 2024
o Credit card CIF market share at 14%, Retail Card spends grew 14% YOY
o Asset quality stable, credit cost higher due to seasonality and lower recoveries and upgrades, not indicative of full year credit costs
o PCR healthy at 78%; On an aggregated basis5, Coverage ratio at 150%
o Gross slippage ratio at 1.97%, Net slippage ratio at 1.37%
o Q1FY25 net credit cost at 0.97%
Key domestic subsidiaries continue to deliver steady performance
o Q1FY25 profit at 436 crores up 47% YOY, with a return on investment in domestic subsidiaries of 54%
o Axis Finance Q1FY25 PAT grew 26% YOY to 154 crores; asset quality metrics improve, ROE at 14.7%
o Axis AMC Q1FY25 PAT grew 27%YOY to 116 crore,
o Axis Securities Q1FY25 PAT grew 171% YOY to 121 crores
o Axis Capital Q1FY25 PAT grew 220% YOY to 49 crores and executed 22 investment banking deals in Q1FY25
Core Operating Profit and Net Profit
The Bank’s core operating profit for the quarter grew 16% YOY to 9,637 crores. Operating profit grew 15% YOY to 10,106 crores. Net profit stood at 6,035 crores in Q1FY25 as compared to 5,797 crores in Q1FY24, and grew 4% YOY.
Net Interest Income and Net Interest Margin
The Bank’s Net Interest Income (NII) grew 12% YOY and 3% QOQ to 13,448 crores. Net interest margin (NIM) for Q1FY25 stood at 4.05%.
Other Income
Fee income for Q1FY25 grew 16% YOY to 5,204 crores. Retail fees grew 18% YOY; and constituted 71% of the Bank’s total fee income. Retail cards and payments fee grew 12% YOY. Retail Assets (excluding cards and payments) fee grew 13% YOY. Fees from Third Party Products grew 68% YOY. The Corporate & Commercial banking fees together grew 12% YOY and 1% QOQ to 1,497 crores. The trading income gain for the quarter stood at 406 crores; miscellaneous income in Q1FY25 stood at 173 crores. Overall, non-interest income (comprising of fee, trading and miscellaneous income) for Q1FY25 grew 14% YOY to 5,783 crores.
Provisions and contingencies
Provision and contingencies for Q1FY25 stood at 2,039 crores. Specific loan loss provisions for Q1FY25 stood at 2,551 crores. The Bank holds cumulative provisions (standard + additional other than NPA) of 11,732 crores at the end of Q1FY25. It is pertinent to note that this is over and above the NPA provisioning included in our PCR calculations. These cumulative provisions translate to a standard asset coverage of 1.20% as on 30th June, 2024. On an aggregated basis, provision coverage ratio (including specific + standard + additional) stands at 150% of GNPA as on 30th June, 2024. Credit cost (annualized) for the quarter ended 30th June, 2024 stood at 0.97%.
Balance Sheet: As on 30th June 2024
Balance Sheet: As on 30th June 2024 The Bank’s balance sheet grew 13% YOY and stood at 14,68,163 crores as on 30th June 2024. The total deposits grew 13% YOY on month end basis, of which current account deposits grew 12% YOY; total term deposits grew 20% YOY and 1% QOQ. *+The share of CASA deposits in total deposits stood at 42%**. On QAB basis, total deposits grew 14% YOY and 3% QOQ, within which
savings account deposits grew 3% YOY and 3% QOQ,
current account deposits grew 8% YOY and 2% QOQ;
and total term deposits grew 21% YOY and 4% QOQ.
The Bank’s advances grew 14% YOY and 2% QOQ to 9,80,092 crores as on 30th June 2024.
Gross of transfers through Inter Bank Participation Certificates (IBPC), total Bank advances grew 15% YOY and 1% QOQ. Retail loans grew 18% YOY to 5,85,112 crores and accounted for 60% of the net advances of the Bank.
The share of secured retail loans was ~ 71%, with home loans comprising 28% of the retail book. Home loans grew 6% YOY, Personal loans grew 29% YOY, Credit card advances grew 22% YOY, Small Business Banking (SBB) grew 26% YOY and 2% QOQ; and rural loan portfolio grew 24% YOY. SME book remains well diversified across geographies and sectors, grew 20% YOY to 1,04,016 crores.
Corporate loan book (gross of IBPC sold) grew 10% YOY;
domestic corporate book grew 7% YOY and 4% QOQ.
Mid-corporate book grew 24% YOY and 2% QOQ.
89% of corporate book is now rated A- and above with 89% of incremental sanctions in Q1FY25 being to corporates rated A- and above. The book value of the Bank’s investments portfolio as on 30th June 2024, was 3,16,851 crores, of which 2,47,795 crores were in government securities, while 56,384 crores were invested in corporate bonds and 12,672 crores in other securities such as equities, mutual funds, etc. Out of these, 67% are in Held till Maturity (HTM) category, 12% of investments are Available for Sale (AFS), 19% are in Fair Value through Profit & Loss (FVTPL) category and 2% are investments in Subsidiaries and Associate. **Asset Quality** As on 30th June, 2024 the Bank’s reported Gross NPA and Net NPA levels were 1.54% and 0.34% respectively as against 1.43% and 0.31% as on 31st March, 2024. Recoveries from written off accounts for the quarter was 591 crores. Reported net slippages in the quarter adjusted for recoveries from written off pool was 2,700 crores, of which retail was 2,456 crores, CBG was 13 crores and Wholesale was 231 crores. Gross slippages during the quarter were 4,793 crores, compared to 3,471 crores in Q4FY24 and 3,990 crores in Q1FY24. Recoveries and upgrades from NPAs during the quarter were 1,503 crores. The Bank in the quarter wrote off NPAs aggregating 2,206 crores.
As on 30th June, 2024, the Bank’s provision coverage, as a proportion of Gross NPAs stood at 78%, as compared to 80% as at 30th June, 2023 and 79% as at 31st March, 2024.
Disc - tracking
Restructuring Between Max Life & Max Financial Services
To start restructuring process from H2FY25