Prashant Kumar, Managing Director & CEO, YES Bank
Private sector lender YES Bank put up a strong show in the fourth quarter (January-March) of the fiscal year 2021-22 . The bank reported a profit of Rs 367 crore against a loss of Rs 3,788 crore registered in the corresponding quarter of the previous fiscal, driven by a sharp downtick in provisions, strong net interest income, and pre-provision operating profit (PPoP) with an improvement in asset quality performance.
On a sequential basis, the numbers grew 38 percent as the profit in the December quarter stood at Rs 266 crore.
For the full year, the bank reported a profit for the first time since FY19, at Rs 1,066 crore against a loss of Rs 3,462 crore in FY21 and a loss of Rs 22,715 crore in FY20, but net interest income (NII) declined 12.5 percent to Rs 6,498 crore compared to the previous year.
“This transformation journey taking place at YES Bank has resulted in a sustained improvement in balance sheet growth, accelerated granularization, improving asset quality trends, enhanced liquidity, and stronger capital position over the past 2 years,” said Prashant Kumar, MD & CEO.
Kumar further said while the core operating profitability of the franchise continues to improve, the drag from legacy stressed assets has significantly reduced, resulting in net profitability.
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The bank’s NII (the difference between interest earned and interest expended) grew 84.4 percent year-on-year to Rs 1,819 crore in Q4FY22, while on a sequential basis, it rose merely 3.1 percent. Net interest margin came in at 2.5 percent, up 90 bps year-on-year and 10 bps sequentially.
Loan book at Rs 1.81 lakh crore as of March 2022 increased by 8.5 percent YoY and 3 percent QoQ, with retail: corporate mix at 60:40 (rising 300 bps QoQ). The bank added that deposits at Rs 1.97 lakh crore rose by 21 percent compared to March 2021. On a QoQ basis, it grew 7 percent.
Provisions and contingencies for the quarter ended March 2022 stood at Rs 271 crore, declining substantially by 94.7 percent compared to the year-ago period and 27.7 percent from the previous quarter.
The asset quality has seen good improvement at the end of March 2022, with gross non-performing assets (NPA) coming in at 13.9 percent, down from 14.7 percent in the previous quarter. Net NPA declined to 4.5 percent from 5.3 percent in the previous quarter, driven by a significant fall in slippages.
Slippages at Rs 5,795 crore as of March 2022 halved from Rs 12,035 crore at the end of March 2021 and for the fourth quarter, slippages were at Rs 802 crore, the lowest in FY22, against Rs 978 crore seen in December 2021 quarter, said YES Bank.
The bank further said resolution momentum continued with total recoveries & upgrades for FY22 coming in at Rs 7,290 crore against Rs 5,782 crore in FY21 and for Q4FY22, it stood at Rs 1,828 crore, which was also higher than Rs 1,182 crore in the previous quarter.
YES Bank said pre-provision operating profit shot up to Rs 774 crore during the quarter under review, up more than 13 times over the corresponding period last fiscal and 6 percent over the previous quarter.
The bank also registered good growth in other income (non-interest income) that increased 27.9 percent YoY and 20.2 percent QoQ to Rs 882 crore in Q4FY22.
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