Federal Bank net income falls 14.7% amid rising credit costs from MFI, agri books
The key net interest income rose 1.96% to Rs 2,336.83 crore, while other income jumped to Rs 1,113 crore, up 21.6%, taking the total income up 7.64% to Rs 7,799.61 crore, the management led by chief executive KVS Manian told reporters in an earnings call Saturday.
The asset quality was impacted by a 39 bps rise in credit costs to 65 bps from 26 bps in the year-ago period, largely driven by slippages in the agri and MFI portfolios. This has the total slippages rising by 1.1% in the quarter. "Based on current trends, we expect these slippages to moderate and stabilise going forward, leading to a normalisation in credit costs," Manian said.
The bank added Rs 686 crore in fresh slippages, mostly from the microfinance and agri books.
The total business of the bank grew 8.5% to reach Rs 5,28,640.65 crore, making it the sixth largest private sector lender. The total deposits were Rs 2,87,436.31 crore (of this the low-cost Casa base expanded 12% to Rs 87,236 crore), which grew 8.03%, and advances were Rs 2,41,204.34, which grew 9.24% during the quarter.
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