IDFC First Bank Limited

The key takeaways from the provided information about IDFC FIRST Bank Limited’s financial results and performance for the quarter and half year ended September 30, 2023, are as follows:

Profitability:

• Net Profit for Q2-FY24 increased by 35% year-on-year (YoY), from Rs. 556 crore in Q2-FY23 to Rs. 751 crore in Q2-FY24, driven by strong growth in core operating income.
• Core Operating Profit (pre provision operating profit excluding trading gains) grew by 38% YoY.
• Net Interest Income (NII) increased by 32% YoY, and Net Interest Margin (NIM) improved.
• Fee and Other Income grew by 46% YoY, with retail fees constituting the majority of fees.
• Operating Expense increased by 34% YoY.
• Provisions increased 25% YoY, with a credit cost of 1.19%.
• Return on Assets (RoA) and Return on Equity (RoE) improved.

Deposits & Borrowings:

• Customer Deposits increased by 44% YoY.
• CASA Deposits grew by 26% YoY, with a CASA ratio of 46.4%.
• Retail deposits grew by 50% YoY, constituting 77% of total customer deposits.
• Legacy High-Cost Borrowings reduced.

Funded Assets:

• Funded assets (including advances & credit substitutes) increased by 26% YoY.
• The Bank continued to wind down infrastructure financing, now constituting only 1.8% of total funded assets.

Assets Quality:

• Gross NPA (GNPA) and Net NPA (NNPA) of the bank improved.
• GNPA of the Retail, Rural, and SME Finance segment improved.
• Provision coverage ratio increased.
• Standard restructured book as a percentage of total funded assets improved.

Capital Position & Liquidity:

• Capital Adequacy of the Bank was strong, with CET-1 Ratio at 13.49%.
• The Bank successfully raised capital via qualified institutional placement (QIP).
• Average Liquidity Coverage Ratio (LCR) was strong.

Comments from Managing Director & CEO:

• The bank is focused on building fundamentals, culture, and products for the long run.
• Customer deposits continue to grow, and asset quality remains strong.
• The Bank recorded a profit in H1-FY24, representing a growth of 47% over the previous year.