(Bloomberg) -- HDFC Bank Ltd., India’s largest private sector lender, kicked off the earnings season for the nation’s finance sector with profit that surpassed analyst expectations boosted by a strong loan and deposit growth.
Net income gained 35% to 161.7 billion rupees ($1.9 billion) in the three months ended June 30 compared with the year-ago quarter, according to a statement Saturday. That compared with the average analyst estimate of 156.52 billion rupees in a Bloomberg survey.
Interest income rose 50% to 730.3 billion rupees, beating estimates, the filing showed.
HDFC’s earnings are typically a bellwether for the performance of the sector which has struggled with sluggish growth in deposits for several quarters. India’s central bank has raised concerns on the credit-deposit ratios at lenders, a measure of how much a bank’s deposits are being lent out as loans, which now stands at a decade high.
HDFC Bank CEO Sashidhar Jagdishan has said his firm aims to lower its credit-deposit ratio, elevated largely due to its merger with its parent last year, to levels seen prior to the tie-up. HDFC is mulling a sale of some of its loan portfolio which could help address this, Bloomberg News has reported.
The lender saw its gross non-performing assets ratio widen to 1.33% of the total, from 1.24% in the preceding period. Provisions fell 81% to 26 billion rupees compared with the March quarter.
(Updates with details throughout.)
©2024 Bloomberg L.P.
