The Bank also reported that Net Interest Income (NII) grew by 22% yoy to Rs1,660cr, up from Rs1,363cr in Q2FY20. Despite the Covid-19 pandemic impact, the qoq NII grew by 2%. Net Interest Margin (NIM%) (quarterly annualized): NIM% rose to 4.57% in Q2FY21 from 3.43% in Q1FY20 and 4.53% in Q1FY21.
Overall Customer Deposits grew by 35% yoy to Rs69,368cr, 11% qoq. Overall Funded Asset de-grew by 1% yoy, grew by 3% qoq to Rs1,06,828cr. Retail Loan Assets grew by 25% yoy, 7% qoq to Rs59,860cr. Asset quality was Stable with GNPA and NNPA at 1.62% and 0.43% respectively (PCR at 74%). Capital Adequacy Ratio was strong at 14.73% with tier-1 CAR at 14.33%. Average Liquidity Coverage Ratio (LCR stood at 138% for Q2FY20.
The Bank reversed Rs811cr provision out of existing provision of Rs1,622cr on exposure to a large telecom player, based on improved prospects of the company, and used it for creating provisions for additional Covid-19 contingency of Rs1,400cr; thus making the total Covid-19 contingency provision of Rs2,000cr as of September 30, 2020, 2.21% of the standard advances.
V Vaidyanathan, Managing Director and CEO, IDFC FIRST Bank, said, “Since day one of the merger, our first priority was to strengthen the deposit side of the bank with stable retail deposits. We were very clear that we don’t want to grow the loan book until this is addressed. I am happy to say that IDFC FIRST Bank CASA ratio has reached industry best standards of over 40%. With the liability side firmly addressed, you will see growth in the total loan book from Q3 FY21 and onwards. I am further happy to inform you that the collection performance on retail loans have improved sharply after the lockdown has been lifted, and in fact are much stronger than earlier anticipated.”