Kotak Mahindra Bank announces 17% net profit increase in Q4
What's the story
Kotak Mahindra Bank, a prominent private sector lender, has reported a 16.88% year-on-year (YoY) rise in its consolidated net profit for the first quarter of the year. The bank's net profit escalated to ₹5,337.2 crore from ₹4,566.39 crore during the same period last year. This surge was driven by robust loan growth as well as an increase in fee income.
Growth
Standalone net profit and fee income rise
The standalone net profit of Kotak Mahindra Bank also saw a remarkable growth of 18.24% YoY, reaching ₹4,133.3 crore. The bank's net interest income - the difference between interest earned and interest expended - experienced a 13% annual growth to ₹6,909 crore. Additionally, fee income witnessed a substantial rise of 28% to ₹2,467 crore for the quarter under review.
Performance
Operating costs and loan growth
For the entire fiscal year, the standalone net profit of Kotak Mahindra Bank saw a jump of 26% to ₹13,782 crore. However, the bank's operating costs also increased to ₹16,679 crore in FY24 from ₹13,787 crore in FY23. The bank clocked a loan growth of 20% to ₹3.91 lakh crore as of March 31, 2024. Technology expenses accounted for 10% of the total operating cost in FY24.
Asset increase
Customer assets and unsecured retail advances show growth
The bank's report highlighted that "Customer Assets," which include Advances and Credit Substitutes, grew by 20% YoY to ₹423,324 crore as at March 31, 2024, from ₹352,652 crore as at March 31, 2023. Unsecured retail advances (comprising Retail Micro Finance) as a percentage of net advances, stood at 11.8% as at March 31, 2024, up from last year's figure of 10%.
Financial health
Kotak Mahindra Bank reports healthy liabilities and NPA figures
On the liabilities front, average term deposits at Kotak Mahindra Bank saw a significant increase of 35% YoY in Q4 to ₹2.25 lakh crore. Current and savings account deposits experienced modest growth rates of 3% and 5%, respectively on a YoY basis. As of March end of this year, gross NPA was at a low of just 1.39% and net NPA was at an even lower figure of just 0.34%. Both showed improvements from last year's figures.