HDFC Bank Q4 net profit rises 17.7% to Rs 6,928 crore

India’s leading private sector lender HDFC Bank on Saturday (April 18) released its results for the fourth quarter of 2019-20, reporting a 15.4 per cent rise in consolidated net profit at Rs 7,280.22 crore for the Q4. 

The HDFC Bank said in a regulatory filing that it reported 17.7% rise in net profit in the quarter ending March 31, 2020 with the Q4 net profit standing at Rs 6,928 crore as against Rs 5,885 crore in the year-ago period.

“Net interest income (interest earned less interest expended) for the quarter ended March 31, 2020 grew to Rs 15,204.1 crore from Rs 13,089.5 crore for the quarter ended March 31, 2019, driven by growth in advances of 21.3%, and a growth in deposits of 24.3%. The net interest margin for the quarter was at 4.3%,” HDFC Bank said in a press release.

The bank that the outbreak of COVID-19 had affected the economic activities and the lockdown imposed by Prime Minister Narendra Modito curb the spread of coronavirus in India had a direct impact on the bank’s business volumes.

“During the quarter, there was a considerable slowdown in economic activities following the outbreak of COVID-19. Furthermore, with the government initiating lockdown in the latter half of March, and our strict adherence to social distancing, not only did we see an impact on business volumes – in terms of loan originations, distribution of third party products, and payments product activities, but we also could not optimize our collection efforts, and as a result of which fees/other income were lower by Rs 450 crore,” said the bank. 

The bank also said it will not make any further dividend payouts from profit pertaining to 2019-20 as per the directives of the Reserve bank of India. It may be recalled that on Friday (April 17), the RBI had had debarred banks from dividend payouts so that they can conserve capital in an environment of heightened uncertainty caused by the COVID-19 crisis.