Overall, gross and net non-performing asset ratio stood at 2.60 per cent and 0.29 per cent as on March end
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Mid-sized private sector lender RBL Bank on Friday reported an 81 per cent year-on-year (y-o-y) fall in net profit for the quarter ended March at ₹69 crore, as provisions spiked due to higher bad loans. The lender had reported ₹33 crore net profit in Q3FY25.
Fresh slippages stood at ₹1,058 crore in Q4FY25, sharply higher than ₹680 crore in Q4FY24.Of the total slippages in the reporting quarter, ₹444 crore of slippages emanated from the credit card portfolio, while ₹439 crore of bad loans were from the micro loan segment. In comparison, during Q3FY25, ₹533 crore of slippages emanated from the credit card portfolio, and ₹521 crore of slippages were from the micro loan business.
As bad loans rose, provisions spiked to ₹785 crore in Q4FY25 from ₹414 crore in the corresponding period last year.The bank’s management said the lender has 100 per cent provision on its micro loan segment bad debt.Whereas, the total provisions including specific, general and contingent provision stands at 120 per cent of gross non-performing assets.
Overall, gross and net non-performing asset ratio stood at 2.60 per cent and 0.29 per cent as on March end versus 2.92 per cent and 0.53 per cent last quarter, respectively. The bank expect slippages to normalise by July-September quarter.
Core business
RBL Bank’s net advances rose 10 per cent y-o-y to ₹92,618 crore in Q4, while deposits rose 7 per cent on-year to ₹1.10 lakh crore. Microloans and personal loans witnessed a decline in reporting quarter as the lender shifts its focus to secured, higher-yielding loans.
“Our unsecured loans were in the range of 34 per cent a couple of years ago, and right now we are at 29 per cent…this 29 per cent may moderate further by 1-2 per cent. Ultimately, we are moving towards a better yield on secured products like small loans against property and affordable home loans. These products will be able to adequately compensate. Their cost of operation will come down, cost to income in mortgage loans will also come down,” said R Subramaniakumar, MD & CEO, RBL Bank, in a post-earnings media call. Granular deposits, meanwhile, are expected to grow by 20-25 per cent in FY26, he said.
Net interest income of the lender was down 2 per cent y-o-y at ₹1,563 crore,while other income rose 14 per cent on-year to ₹1,000 crore in Q4.Net interest margin of the lender was at 4.89 per cent in Q4, lower than 5.45 per cent last year.The bank expects margins to fall in the near term and stabilise at current levels in the next 3-4 quarters. The bank’s board today recommended a dividend of ₹1 per equity share for FY25.
Published on April 25, 2025
