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Federal Bank delivers highest ever operating profit of Rs.589 Cr in Q4 Featured

Published in Banking & Finance Thursday, 10 May 2018 11:37

Federal Bank announced its audited financial results for the quarter and year ended 31st March 2018 at Mumbai

Summary of Q4 Results

The Bank delivered robust growth in all business segments with 5% plus sequential growth in all three credit segments – Corporate, SME and Retail. On the liability front, the Bank clocked a thumping growth of 12%, 8% and 9% in CASA, NRE, and Retail Deposits Q-o-Q.

With respect to the core business metrics of Q4, the Bank met growth expectations. However, the Bank, imbibing the spirit of the revised benchmark for resolution of stressed assets, accelerated the recognition of NPAs, so as to materially improve the stressed asset portfolio. As a result, the stressed book of the Bank (NNPA + Standard Restructured + Security Receipts) is the lowest in 12 quarters. The ratio of Stressed Assets to Total Average Assets is also the least in 12 quarters, even on a robustly growing asset portfolio. The Restructured Standard Book size which includes all erstwhile, SDR, 5/25, S4A etc. is only ₹ 792 Crores now. The Bank crossed ₹ 2,00,000 crore in total business and delivered its highest operating profit of ₹589 Cr in Q4.

Key Highlights

•    • Delivered highest ever operating profit of ₹ 589 crores in Q4
•    • All credit business segments grew by a robust 5% plus Q-o-Q
•    • Materially reduced stressed book size by accelerating NPA recognition in compliance with the revised framework for resolution of stressed assets
•    • Total business of the Bank crossed the milestone figure of Rupees two lakh crore and reached ₹ 2,03,949.96 Cr
•    • Total advances registered a growth of 26% to reach ₹ 93,172.60 Cr
•    • CASA grew by 17% Y-o-Y in Q4 to reach ₹ 37,252 crores. CASA ratio stands at 33.26%
Commenting on the results and financial performance, Shyam Srinivasan, Managing Director & CEO, Federal Bank said, "Our core franchise across all segments – corporate, SME and retail, as well as our granular liability profile with very strong loyalties form our customer base, is growing robustly in a broad-based manner across products, verticals and geographies. Our results today substantiate this tellingly. The revised framework for resolution of stressed assets, being a new regulation, has impacted our bottom line figure. This is as a result of our accelerated recognition of sensitive assets abiding by the spirit of the revised regulation on stressed asset resolution, which, I am sure, will go far to strengthen and professionalize the banking industry’s capabilities to manage stressed assets. Having turned the corner with respect to recognition of NPAs from the restructured standard book this Q4, the Bank is confident of meeting the expectations of its stakeholders and will start FY 19 with significantly lower stress."
Working Results at a Glance

( in Crore) Particulars     FY18     FY17     % y-o-y growth
Net Interest Income     3,582.81     3,052.65     17.37%
Other Income     1,159.12     1,081.81     7.15%
Total Income     10,911.98     9,759.20     11.81%
Operating Profit     2,291.03     1,924.93     19.02%
Net Profit     878.85     830.79     5.78%

Last modified on Thursday, 10 May 2018 12:01

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