In Q2, Axis Bank reports its highest-ever quarterly profit of Rs 3,133 crore, up 86 percent from the previous quarter; it also tops expectations

Axis Bank, a private sector lender, reported an 86 percent year-on-year (YoY) increase in net profit for the second quarter ended September 30, 2021, resulting in its highest quarterly profit of Rs 3,133 crore.

The bank had a net profit of Rs 1,683 crore in the same period the previous year. For the quarter under review, a CNBC-TV18 poll anticipated a profit of Rs 2,912.1 crore.
For the quarter, the bank’s operating profit was Rs 5,928 crore, while its core operating profit was Rs 5,456 crore. Net interest income (NII) for the bank increased by 8% year on year to Rs 7,900 crore from Rs 7,326 crore in Q2FY21. In Q2FY22, the net interest margin (NIM) was 3.39 percent.

Fee income increased by 17% YOY and 21% QOQ to Rs 3,231 crore in Q2FY22. Retail fees increased 19 percent year over year and 23 percent quarter over quarter, accounting for 63 percent of the bank’s overall fee income. The fee for corporate and commercial banking increased 15% year over year and 18% quarter over quarter.
For the quarter, trade earnings and miscellaneous incomes were Rs 473 crore and Rs 95 crore, respectively. Non-interest income (fee, trading profit, and miscellaneous income) totaled Rs 3,798 crore in Q2FY22, increasing 6% year on year and 13% quarter on quarter.

In Q2FY22, specific loan loss provisions were Rs 927 crore, down from Rs 2,865 crore in Q1FY22. During the quarter, the bank did not use COVID provisions. At the conclusion of Q2FY22, the bank had Rs 12,951 crore in cumulative provisions (standard + additional other than NPA).

“It’s worth noting that this is in addition to the NPA provisioning factored into our PCR calculations. As of September 30, 2021, these reserves add up to a standard asset coverage of 2.11 percent. As of September 30, 2021, our provision coverage ratio (which includes specified + standard + additional + Covid provisions) was 124 percent of GNPA.

The credit cost for the quarter ended September 30, 2021, was 0.54 percent, down from 1.70 percent in Q1FY22, according to a press release from the bank.

Net interest income increased by 9% year on year to Rs 15,661 crore from Rs 14,311 crore in H1FY22. Fee income increased by 34% year on year to Rs 5,899 crore. From Rs 10,877 crore in H1FY21 to Rs 11,064 crore in H1FY21, core operating profit increased by 2% to Rs 11,064 crore. Total provisions for H1FY21 were Rs 5,037 crore, down 40% from the same time the previous year. From Rs 2,795 crore in H1FY21 to Rs 5,293 crore in H1FY22, the company’s net profit increased by 89 percent to Rs 5,293 crore.
The results were released after the market had closed for the day. Axis Bank’s stock closed at Rs 844.00 on the BSE, down Rs 1.05 or 0.12%.