Kotak Mahindra Bank's deposits rise 19.6% in March quarter, CASA ratio improves to 56.2%

 Uday Kotak-led Kotak Mahindra Bank has reported rise in their deposit portfolios during January-March period, and also announced a cut in savings account rates for high value customers.

The private lender reported a 19.6 per cent growth in total deposits, excluding Certificate of Deposits (CPs), at Rs 2.58 lakh crore during the March quarter of this fiscal, compared to Rs 2.16 lakh crore in the same quarter last year. On the quarter-on-quarter basis, the aggregate deposits increased by 11.7 per cent from Rs 2.31 lakh crore as of 31 December 2019, Kotak Mahindra Bank said in a filing to Bombay Stock Exchange on Monday.

While the current deposits rose by 10.5 per cent to Rs 43,000 crore in Q4FY20 verus Rs 38,901 crore in Q4FY19, savings accounts grew sharply by 31.3 per cent to Rs 1.04 lakh crore from Rs 79,685 crore in the year-ago period.

The Certificate of Deposits declined to Rs 4,400 crore as compared to Rs 9,731 crore in the corresponding period last year and Rs 8,103 crore in December quarter of this fiscal.

Kotak Mahindra Bank's CASA ratio, the ratio of deposits in current and saving accounts to total deposits, climbed to 56.2 per cent in Q4FY20, as against 52.5 per cent as of Q4FY19 and 53.7 per cent as of Q3FY20. A higher CASA ratio means major portion of the deposits of the bank has come from current and savings deposit, which indicates a lower cost of funds.

Also Read: Deposits in HDFC Bank rise 24% in March quarter, advances up 21%

During the January-March period of this fiscal, net advances have grown by 6.7 per cent on yearly basis to Rs 2.19 lakh crore. On quarterly basis, the net advances rose merely by 1.3 per cent to Rs 2.16 lakh crore.

The bank has also slashed the rate offered for deposits of over Rs 1 lakh in the savings account to 5 per cent from the 6 per cent earlier, while those under Rs 1 lakh will continue to earn 4 per cent.

Earlier today, HDFC Bank saw its deposits growing by 24.2 per cent to Rs 11.46 lakh crore in March 2020, from Rs 9.23 lakh crore on March 31. On the quarter-on-quarter basis, the aggregate deposits rose by 7.41 per cent from Rs 10.67 lakh crore as of 31 December 2019, HDFC said in a filing to Bombay Stock Exchange.

Many of banks, especially private sector lenders, have filed limited set of results over the past week, to decimate investor concerns in the aftermath of the Covid-19 crisis and also clear doubts on their health in the wake of the YES BANK crisis. It can be noted that rival including YES Bank, RBL Bank and Indusind Bank have saw a fall in their deposit base in recent time.

While RBL Bank lost about 8 per cent of its deposits in the March quarter, YES Bank saw a 34 per cent or Rs 71,991 crore decline in its deposit base between September 2019 to March 5, indicating a complete break of trust in the bank.

YES Bank's deposit base had fallen considerably from Rs 2.09 lakh crore in September 2019 to Rs 1.37 lakh crore as on March 5, 2020, amid concerns over long-term viability of the bank and its ability to raise fund. Crisis-hit YES Bank has been bailed out by the government and the RBI along with a slew of lenders.

Also Read: Coronavirus update: 697 fresh COVID-19 cases, 109 deaths reported so far

Also Read: Infosys Q4 revenue to take 130bps hit; FY21 outlook gloomy: Analyst report