Federal Bank Q3 Results: Profit jumps 54% YoY at Rs 804 crore; net interest margin at record high

Private lender Federal Bank on Monday reported its highest-ever net profit of Rs 804 crore during the quarter that ended December 2022, up 54% compared to Rs 522 crore in the same quarter in the previous fiscal year.

The bank's net interest income for the quarter ended December 31, 2022, grew by 27.14% to Rs 1,956 crore from Rs 1,539 crore for the third quarter of FY23. Other income of the firm grew by 10.29% to Rs 534 crore in the quarter ended December from Rs 484 crore in Q3FY22.

Further, Federal Bank's net interest margin or NIM rose to 3.49% during the December 2022 quarter, higher by 22 bps year-on-year (YoY) and 19 bps quarter-on-quarter (QoQ). Its loan growth was at 4.3% QoQ 17.1% from the year-ago quarter.

Shares of Federal Bank in today’s trade rose 3.5% to hit a 52-week high of Rs 143.35. The stock has also risen about 40% in the last six months and has surged nearly 43% in the last year.

Its gross NPA at the end of Q3FY23 stood at Rs 4,148 crore, which as a percentage of gross advances stood at 2.43%. The net NPA to net advances as of 31st December 2022 stood at Rs 1,229 crore or 0.73%. The Provision Coverage Ratio (including technical write-offs) was 83.44%. Credit cost for the quarter stood at 0.38%.

Bank's commercial banking advances surged by 18.40% YoY to reach Rs 16794.70 crore, whereas corporate advances stood at Rs 62,182.66 crore in Q3FY23, registering a growth of 19.13% YoY. CASA deposits of the bank also grew by 7.19% to reach Rs 68,967.14 crore.

Retail advances stood at Rs 53,936.45 crore, up 18.13% YoY, while Agri advances reached Rs 22,050 crore, registering a growth of 19.7% YoY.

“An all-round strong operating performance has helped us deliver the highest-ever quarterly profit of 804 crore. Credit Cost has improved on the back of continued strong asset quality, with GNPA and NNPA at 2.43% and 0.73%, respectively. Broad-based asset growth of 19%, coupled with core revenue profile has yielded in higher ROA, currently at 1.33%,“ Shyam Srinivasan, MD & CEO of Federal Bank, said.