Latest news with #UniversalBankingLicense
The Print
12 hours ago
- Business
- The Print
RBI announces 7-day reverse repo rate auction as liquidity enters surplus stage
India's banking system liquidity surplus stood at 2.44 trillion rupees as of June 23, as per RBI data. The Reserve Bank of India (RBI) added that after reviewing evolving liquidity conditions, it will not conduct the 14-day main operation scheduled for Friday, for the ensuing fortnight, according to a press release. Mumbai: India's central bank said on Tuesday it will conduct a seven-day variable rate reverse repo auction worth one trillion rupees ($11.62 billion) on June 27, following a review of liquidity conditions in the banking system. The central bank in June announced a surprise 100-basis-point reduction in the cash reserve ratio, the portion of deposits banks must park with the RBI, in four equal tranches beginning September, lowering it to 3%, to boost policy transmission. Amid surplus liquidity conditions, the weighted average overnight call rate has remained well below the RBI's key repo rate and near the policy corridor's floor, the Standing Deposit Facility rate, for the past few weeks. A persistent gap between the RBI's operative rate and the policy rate typically signals that banks are accessing cheaper funding than what the central bank is comfortable with, as per traders. Earlier this month, Reuters had reported that the RBI could start conducting variable rate reverse repo auctions to suck out surplus liquidity as and when required. 'The move (VRRR announcement) indicates that the RBI wants the operative rate closer to the repo rate,' said Gaura Sen Gupta, India economist at IDFC FIRST Bank. The move comes sooner than expected with the transmission via various channels – credit, deposit and bond market – in its early stages, Sen Gupta said, adding that the move may lead to a further rise in short-term yields. ($1 = 86.0580 Indian rupees) (Reporting by Siddhi Nayak; Editing by Vijay Kishore) This report is auto-generated from Reuters news service. ThePrint holds no responsibility for its content. Also Read: Jana Small Finance Bank Applies to RBI for Universal Banking License
Business Upturn
22-04-2025
- Business
- Business Upturn
AU Small Finance Bank Q4 results: Net profit up 35% YoY to Rs 503.69 crore, NII up 57%
AU Small Finance Bank posted strong financials for the fourth quarter of FY25, beating macroeconomic challenges with robust growth across key metrics. The lender reported a standalone net profit of Rs 503.69 crore for Q4 FY25, up 35.8% from Rs 370.73 crore in Q4 FY24. The growth was attributed to improved operational efficiency and lower provisioning. NII, NIM and earnings Net Interest Income (NII) surged 57% YoY for Q4 FY25 and 55% YoY for the full year. Net Interest Margin (NIM), calculated on daily average interest-earning assets, stood at 5.8% for Q4 (down 6 bps from Q3), and 5.9% for the full year, compared to 5.4% in FY24. The slight dip in quarterly margin was due to asset mix adjustments. Core other income increased 39% YoY for FY25 and 23% YoY for the March quarter, driven by cross-sell efforts and traction in the Authorised Dealer-I (AD-I) business. Q4 FY25 Highlights (YoY) Loan and deposit growth Advances grew 20% YoY to Rs 1.16 lakh crore, led by 21% growth in retail secured assets and 32% growth in commercial banking loans. Deposits jumped 27% YoY to Rs 1.24 lakh crore. The bank's CASA ratio stood at 29.2% as of March 2025, with CA and SA deposits rising by 28% and 12% YoY respectively. Profitability and cost ratios Pre-provision operating profit (PPOP) rose 99% YoY in Q4 to Rs 1,292 crore. For the full year, PPOP increased 86% to Rs 4,581 crore. Return on Assets (RoA) was maintained at 1.5%. Cost-to-income ratio improved to 57% in FY25 from 64% in FY24. Earnings per share (EPS) rose 19% YoY to Rs 28. Asset quality and capital Gross NPA stood at 2.28% and Net NPA at 0.74%. The capital adequacy ratio was healthy at 20.1% following a Rs 770 crore Tier-II capital raise in March 2025. Strategic initiatives The bank completed the integration of Fincare branches and has applied for a Universal Banking License with RBI evaluation currently in progress. It also declared a dividend of Re 1 per share for FY25. Aditya Bhagchandani serves as the Senior Editor and Writer at Business Upturn, where he leads coverage across the Business, Finance, Corporate, and Stock Market segments. With a keen eye for detail and a commitment to journalistic integrity, he not only contributes insightful articles but also oversees editorial direction for the reporting team.
