RBL Bank Q3 net profit more than doubles to Rs146.88cr on operating edge

RBL Bank reported a marginal -2.85% fall in total consolidated revenues in the Dec-20 quarter at Rs2,636.20cr

Jan 28, 2021 05:01 IST India Infoline News Service

RBL Bank reported a marginal -2.85% fall in total consolidated revenues in the Dec-20 quarter at Rs2,636.20cr. While corporate banking revenues fell sharply and treasury was almost flat, the real boost to growth came from the retail banking space. The bank is also positioned to grow with some of the NPA issues of the last 2 years under control now.

For the Dec-20 quarter, the operating profits were up 12.81% at Rs804.63cr. This growth in operating profits was on account of sharply lower interest costs in line with falling rates and surplus liquidity in the system. As a result, operating margin or OPM expanded from a level of 26.29% in Dec-19 to 30.52% in Dec-20 quarter.

Profit after tax (PAT) for the Dec-20 quarter was up by 121% at Rs146.88cr. The better operational metrics of the bank on a yoy basis got magnified after the provisions were almost flat leading to a sharp spike in net profits . Consequently, the PAT margins increased from 2.45% to 5.57% in the same period.

Financial highlights for Dec-20 compared yoy and sequentially

RBL Bank
Rs in Crore Dec-20 Dec-19 YOY Sep-20 QOQ
Total Income (Rs cr) ₹ 2,636.20 ₹ 2,713.41 -2.85% ₹ 2,613.89 0.85%
Operating Profit (Rs cr) ₹ 804.63 ₹ 713.23 12.81% ₹ 728.00 10.53%
Net Profit (Rs cr) ₹ 146.88 ₹ 66.49 120.91% ₹ 152.43 -3.64%
Diluted EPS (Rs.) ₹ 2.62 ₹ 1.48 ₹ 2.98
Operating Margins 30.52% 26.29% 27.85%
Net Margins 5.57% 2.45% 5.83%
Gross NPA Ratio 1.84% 3.33% 3.34%
Net NPA Ratio 0.71% 2.07% 1.38%
Return on Assets 0.62% 0.30% 0.66%
Capital Adequacy 17.33% 15.66% 16.09%

Key takeaways from the Dec-20 quarter results

  • The gross NPAs have come down sharply to 1.84% levels and the concerns over the last 2 years appear to be largely factored and provided for. The bigger challenge would be for the bank to convince the investors that the worst in terms of asset quality is actually over.

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