HDFC Bank Q1FY19: Six key highlights of the result

Largest private lender HDFC Bank missed analysts estimate during the first quarter of FY19 (Q1FY19) result announcement, as the bank posted a net profit of Rs 4,601.44 crore which was higher by 18.17% compared to net profit of Rs 3,893.84 crore in the corresponding period of previous year. However, Q1FY19 net profit was a decline by 4.12% from profit of Rs 4,799.28 crore in the preceding quarter. A Bloomberg poll of analysts had predicted profit of Rs 4,790 crore in Q1FY19 for HDFC Bank.

Here's a list of sex key highlights from the HDFC Bank result this quarter. 

Total Income

The Bank's total income for the quarter ended June 30, 2018 at Rs 26,367.0 crore grew by 18.8% from Rs 22,185.4 crore for the quarter ended June 30, 2017.

Net revenues (net interest income plus other income) increased to Rs 14,631.6 crore for the quarter ended June 30, 2018 from Rs 12,887.4 crore in the corresponding quarter of the previous year.

Net interest income (interest earned less interest expended} for the quarter ended June 30, 2018 grew by 15.4% to Rs 10,813.6 crore, from Rs 9,370.7 crore for the quarter ended June 30, 2017, driven by asset growth and a net interest margin for the quarter of 4.2%. 

Other income

Other income (non-interest revenue) for the quarter ended June 30, 2018 was Rs 3,818.1 crore. Fees and commission income at Rs 3,171.0 crore for the quarter ended June 30, 2018 constituted 83.1 % of other income and grew by 23.0% over Rs 2,578.1 crore in the corresponding quarter ended June 30, 2017.

The other three components of other income for the quarter ended June 30, 2018 were foreign exchange & derivatives revenue of Rs 499.6 crore ( Rs 296.8 crore for the corresponding quarter of the previous year), loss on revaluation / sale of investments of Rs 283.2 crore (gain of Rs 331.4 crore for the corresponding quarter of the previous year) and miscellaneous income, including recoveries and dividend, of Rs 430.7 crore ( Rs 310.3 crore for the corresponding quarter of the previous year).

Balance sheet

Total balance sheet size as of June 30, 2018 was Rs 1,080,409 crore as against Rs 895,653 crore as of June 30, 2017.

Total deposits as of June 30, 2018 were Rs 805,785 crore, an increase of 20.0% over June 30, 2017. As of June 30, 2018 current account deposits were at Rs 109,297 crore and savings account deposits at Rs 226,656 crore grew by 17.4% over June 30, 2017.  

Time deposits were at Rs 469,832 crore, an increase of 24.9% over the previous year, resulting in CASA deposits comprising 41.7% of total deposits as of June 30, 2018.

Total advances as of June 30, 2018 were Rs 708,649 crore, an increase of 22.0% over June 30, 2017. This loan growth was contributed by both segments of the Bank's loan portfolio with the domestic loan mix between retail:wholesale at 55:45. Retail loans grew by 21.6% and wholesale loans grew by 22.7%.

Capital Adequacy:

The Bank's total Capital Adequacy Ratio (CAR) as per Basel Ill guidelines was at 14.6% as on June 30, 2018 (15.6% as on June 30, 2017) as against a regulatory requirement of 11.025% which includes Capital Conservation Buffer of 1.875% and an additional requirement of 0.15% on account of the Bank being identified as a Domestic Systemically Important Bank (D-SI B).

Asset Quality:

Gross non-performing assets were at 1.33% of gross advances as on June 30, 2018, as against 1.30% as on March 31, 2018 and 1.24% as on June 30, 2017. Coverage ratio as on June 20, 2018 was 70%. Net non-performing assets were at 0.4% of net advances as on June 30, 2018.

The Bank held floating provisions of Rs 1,451 crore as on June 30, 2018. Total provisions (comprising specific provisions, general provisions and floating provisions) were 118% of the gross non-performing loans as on June 30, 2018.

Network:

As of June 30, 2018, the Bank's distribution network was at 4,804 banking outlets and 12,808 ATMs across 2,666 cities/ towns as against 4,727 banking outlets and 12,220 ATMs across 2,666 cities/ towns as of June 30, 2017.

Of the total banking outlets, 53% are in semi-urban and rural areas. Number of employees were at 89,550 as of June 30, 2018 (as against 83,757 as of June 30, 2017).