Kotak Mahindra Bank’s Fourth Quarter Results:
Kotak Mahindra Bank Ltd. witnessed a surge in profit during the fourth quarter, surpassing analysts’ projections. According to an exchange filing on Saturday, the consolidated net profit of the private lender rose by 17.6% year-on-year to Rs 5337 crore for the quarter ending March. Analysts surveyed by Bloomberg had anticipated a net profit of Rs 3,303.66 crore. Additionally, the core income, represented by net interest income, climbed by 13.2% year-on-year to Rs 6,910 crore. Key highlights of Kotak Mahindra Bank’s Q4 results include:
- Net profit increased by 17.6% to Rs 4,133.3 crore compared to Rs 3,496 crore (YoY).
- Net interest income rose by 13.2% to Rs 6,910 crore compared to Rs 6,103 crore (YoY).
- Gross NPA ratio improved to 1.39% from 1.73% (QoQ).
- NNPA ratio remained unchanged at 0.34% (QoQ).
The bank‘s asset quality saw improvement, with the gross non-performing asset ratio declining by 34 basis points quarter-on-quarter to 1.39%. Provisions for the quarter surged by 78.7% year-on-year to Rs 263.7 crore. Notably, the bank reversed provisions worth Rs 157 crore related to alternate investments funds, out of the Rs 190 crore made in Q3. The net interest margin remained steady at 5.28% for the second consecutive quarter.
During the quarter, the bank’s advances, inclusive of retail micro-finance, grew by 20% year-on-year to Rs 3.91 lakh crore. Unsecured retail advances as a percentage of net advances slightly increased to 11.8%. Specific segments like home loans and LAP (Loan Against Property) expanded by 15% year-on-year to Rs 1.06 lakh crore, while personal loans, business loans, and consumer durables grew by 27% year-on-year to Rs 20,049 crore. Credit cards recorded a growth of 44% year-on-year to Rs 14,505 crore. The bank concluded the acquisition of Sonata Microfinance in FY24.
However, on April 24, the RBI prohibited Kotak Mahindra Bank from issuing fresh credit cards and onboarding new customers through its online and mobile banking channels immediately. Despite this directive, the bank stated in its Q4 investor presentation that it doesn’t anticipate a significant impact on its overall business. It plans to bolster investments in IT systems to ensure sustainable compliance with the Baseline Cyber Security Framework for Banks and enhance digital payment security controls.
The current account and savings account ratio stood at 45.5% in the quarter. Average current deposits grew by 4% year-on-year to Rs 60,160 crore, while average savings deposits increased by 5% year-on-year to Rs 1.23 lakh crore. Term deposits experienced the highest growth, reaching Rs 2.24 lakh crore, up by 35% year-on-year. The bank’s capital adequacy ratio (CAR) stood at 20.5%, with a Common Equity Tier 1 (CET-1) ratio of 19.2% for the quarter.
