AU SFB Q3 PAT rises 30% YoY to Rs 393 crore; NIM at 6.2%

AU Small Finance Bank reported 30% jump in net profit to Rs 393 crore on a 41% rise in net interest income to Rs 1,153 crore in Q3 FY23 over Q3 FY22.

Net interest margin (NIM) for the quarter was stable at 6.2%. Total income increased by 36% YoY to Rs 2,413 crore in Q3 FY23.

Operating expenses during the quarter amounted to Rs 892 crore, up 40% YoY.

Pre-provisioning profit in Q3 FY23 was Rs 556 crore, up by 21% from Rs 458 crore in Q3 FY22. Provisions dropped by 42% YoY to Rs 33 crore.

Profit before tax stood at Rs 523 crore in Q3 FY23, up by 30% from Rs 402 crore in Q3 FY22.

The bank's asset quality improved on QoQ basis with GNPA at 1.81% as against 1.90% as on 30 September 2022. Net NPA was stable at 0.51%; Restructured advances declined to 1.4%. Provision coverage ratio was at 72% as against 71% as on 30 September 2022; Including technical write-offs, the PCR was at 75%.

Apart from provision of Rs 693 crore against GNPA pool, the bank has, additionally, maintained provision against restructured book at Rs 127 crore (16% of restructured book); contingency provision of Rs 98 crore (0.2% of advances); floating provision of Rs 41 crore (0.1% of advances); and standard provisions of Rs 176 crore (0.3% of advances).

AU SFB said that Q3 FY23 was another quarter of strong and consistent performance across parameters delivering healthy & calibrated loans and deposits growth, stable margins and asset quality, and sustained traction across credit cards and other digital initiatives amidst a challenging macro environment.

The balance sheet size crossed Rs 80,000 crore mark and the net worth of the bank has reached Rs 10,540 crore, a growth of 5x in approximately 5 years (since start of the bank in April'2017). The quarter also saw collection efficiencies sustaining at 107%, resulting in further improvement in asset quality.

During the quarter, the bank opened 42 new touchpoints (net addition 35) and its physical network now spread across 1,015 touchpoints across 21 states and 3 UTs. The bank also established its presence in 2 newer states this quarter namely Andhra Pradesh and Kerala.

The bank's deposits grew by 5% QoQ to Rs 61,101 crore while gross advances increased by 7% QoQ to Rs 56,335 crore. Averaged cost of funds for Q3 FY23 was at 6%.

CRAR at 22% and Tier I at 20% as on 31 December 2022; including interim profits, CRAR was at 24.2% and Tier 1 at 22.2% as on 31 December 2022.

Sanjay Agarwal, MD & CEO, AU Small Finance Bank said: Despite the challenging environment around inflation and liquidity, we were able to maintain margins, deliver growth in loan market share, improve asset quality, focus on productivity while achieving our highest ever quarterly profits.

AU Small Finance Bank (AU SFB/AU) is a scheduled commercial bank, a Fortune India 500 Company and the largest Small Finance Bank in the country.

The scrip shed 0.70% to currently trade at Rs 617.10 on the BSE.

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