HDFC Bank, India’s third largest bank, has posted a 27.1 per cent increase in profit to Rs 1,982 crore for the quarter ended September 2013 — the first time in a decade that its profit growth has fallen below 30 per cent.
While net interest income gained nearly 15 per cent to Rs 4,480 crore, the bank’s loan book grew at a slower pace than expected by some analysts as the economy expanded the least in a decade. Its non-interest income rose 25.3 per cent to Rs 1,844 crore. It took a mark-to-market loss of Rs 173.3 crore, which is reflected in non-interest income.
The bank chose not to amortise net depreciation on available-for-sale (AFS) and held-to-maturity bonds over three quarters and took a one-time hit, which dragged profit down by Rs 76.61 crore, executive director Paresh Sukthankar said. “We have not had any fixation of a particular number. The actual number rolls out,” he said. The Reserve Bank of India had given banks the one-time flexibility after its unconventional liquidity tightening measures of July jacked up bond yields. Its shares fell 2.37 per cent to close at Rs 651.40 on the BSE.
The bank’s asset quality also dipped. Gross non-performing assets were at 1.09 per cent of advances as against 1.04 per cent as on June 30, 2013 and 0.91 per cent as on September 30, 2012. The bank expects a pullback from the corporate side for credit in the next two quarters as it been a bit restrained in lending to the segment till now, Sukthankar said.