HDFC Bank FY21 profit rises 18.5% to Rs 31,116.53 crore; no dividend amid COVID uncertainty

HDFC bank posted an 18.5 per cent increase in its net profit for the financial year ended March 31, 2021. The private sector lender registered standalone net profit of Rs 31,116.53 crore during the FY21, as compared to Rs 26,257.32 crore in FY20, according to a regulatory filing.

HDFC bank earned Rs 146,063.12 crore during the period under review, as against Rs 138,073.47 crore in the previous fiscal. Net interest income at the end of FY21 stood at Rs 64,879.57 crore, as compared to Rs 56,186.25 crore in FY20, a jump of 15.47 per cent. Net revenue, the sum of net interest income and other income, stood at Rs 90,084.5 crore during the fiscal under review, as against Rs 79,447.1 crore during the year-ago period.

The core net interest margin for the fiscal ended March 2021 was 4.2 per cent. The cost-to-income ratio during the last fiscal was 36.3 per cent, as opposed to 38.6 per cent recorded for the previous fiscal.

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For the quarter ended March 31, 2021, HDFC Bank reported net profit of Rs 8,186.5 crore, 18.2 per cent higher than the year-ago period. Net interest income during the quarter under review increased 12.6 per cent to Rs Rs 17,120.2 crore driven by advances growth of 14 per cent and a core net interest margin of 4.2 per cent.

Total credit cost ratio in March quarter last fiscal was at 1.64 per cent as compared to 1.51 per cent in the corresponding quarter of previous fiscal. Provisions and contingencies for the quarter ended March 31, 2021 stood at Rs 4,693.7 crore as against Rs 3,784.5 crore in the same quarter of the previous fiscal.

HDFC Bank stated that its Capital Adequacy Ratio (CAR) stood at 18.8 per cent as of March 31, 2021, as against a regulatory requirement of 11.075 per cent. The bank had posted 18.5 per cent CAR at the end of March 31, 2020. The lender informed that its Tier I CAR was at 17.6 per cent as of March 31, 2021, as compared to 17.2 per cent on March 31, 2021. Common Equity Tier I Capital Ratio was at 16.9 per cent as of March 31, 2021. Risk-weighted assets were pegged at Rs 1,131,144 crore at the end of FY21, and the same stood at Rs 994,716 crore at the end of FY20.

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On asset quality front, HDFC Bank saw its net non-performing assets (NNPAs) rise to Rs 4,554.82 crore in FY21 from Rs 3,542.36 crore in FY20. Meanwhile, its gross non-performing assets (GNPAs) grew to Rs 15,086 crore during the fiscal under review from Rs 12,649.97 crore in the previous fiscal. NNPAs as a per cent of net advances increased to 0.4 per cent in FY21 from 0.36 per cent in FY20. GNPAs were 1.32 per cent of gross advances as of March 31, 2021, as compared to 1.26 per cent on March 31, 2020.

Considering the potential impact of COVID-19, HDFC Bank said that it is holding provisions in excess of the RBI prescribed levels. As of March 31, 2021, bank's floating provisions stood at Rs 1,451 crore and contingent provisions at Rs 5,861 crore. Total provisions were 153 per cent of the GNPAs at the end of FY21, the lender said.

Meanwhile, amid the second wave of COVID-19 cases, HDFC Bank said that its board of directors has decided not to offer a final dividend for FY21 in view of the persisting uncertainty.

"Given that the current "second wave" has significantly increased the number of COVID-19 cases in India and uncertainty remains, the Board of Directors of the Bank, at its meeting held on April 17, 2021, has considered it prudent to currently not propose dividend for the financial year ended March 31, 2021. The Board shall reassess the position based on any further guidelines from the RBI in this regard," HDFC Bank said in its filing.

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(Edited by Vivek Punj)