AIF Provisioning Limit Growth In RBL's Q3 Net Profit To 11%

RBL Bank on Friday reported an 11 per cent growth in its December quarter net profit to Rs 233 crore, restricted by a Rs 115 crore provision towards exposure to alternate investment funds (AIFs) following an RBI order.

The private sector lender had reported a net profit of Rs 209 crore in the year-ago period.

Its net interest income rose 21 per cent to Rs 1,546 crore for the reporting quarter, while the other income was up 26 per cent at Rs 778 crore.

The core income was helped by a 20 per cent growth in advances and a 0.25 per cent expansion in the net interest margin to 5.52 per cent.

Its chief executive and managing director R Subramaniakumar said if not for the Rs 115 crore provision for AIF investments, the profit after tax would have risen by over 50 per cent.

He said the bank's investments are in venture debt funds which provide funds to new-age businesses.

The bank has been funding such platforms for over a decade and does not see any reverses on the portfolio, he said, adding that the current net asset value of its exposure is over Rs 160 crore.

The overall provisioning stood at Rs 458 crore against Rs 292 crore in the year-ago period. On the asset quality front, its gross non-performing assets ratio was stable at 3.12 per cent.

The bank is targeting a loan growth of over 20 per cent each in FY25 and FY26 led by the retail segment, he said.

The deposit growth during the quarter was 13 per cent, and the credit deposit ratio was 86 per cent, the chief executive said, adding that it wants to grow the granular deposits.

The recent move by the Reserve Bank on upping risk weights on unsecured advances has impacted the overall capital adequacy by 0.65 per cent. The overall capital adequacy was 15.66 per cent as of December 31 and the bank will not need capital for six more quarters.

The RBL Bank scrip closed 1.59 per cent down at Rs 265.70 apiece on the BSE on Friday against gains of 0.70 per cent on the benchmark.