ET Intelligence Group: The banking sector reported a record quarterly net profit for the September quarter amid improving stability in net interest margins (NIMs) and sustained double-digit growth in pre-provisioning operating profit (PPOP). For a sample of 29 publicly-listed banks, aggregate net profit rose by 20.9% year-on-year to ₹92,835 crore - the highest quarterly profit for the sample banks.The extent of net profit has improved significantly over the past few quarters. The sample's net profit in the latest quarter was two-and-a-half times ₹36,741 crore reported in the September 2021 quarter. The 15 public sector banks (PSBs), part of the sample, showed more improvement than their private sector counterparts. For PSBs, aggregate net profit rose 2.6 times to ₹45,546 crore between the September 2021 quarter and September 2024 quarter. Net profit for private sector banks in the sample improved 2.4 times to ₹47,289 crore.116665889The total sample's PPOP grew by 19.6% year-on-year to ₹1.5 lakh crore in the September quarter. PSBs reported a higher growth of 24.2% in PPOP at ₹78,158 crore, while for private banks, it grew by 15.1% to ₹73,408 crore. NIMs have been under pressure over the past few quarters as the increase in deposit rates has outpaced interest rates charged by banks while disbursing loans to attract more deposits. However, the pressure is easing since credit growth is gradually aligning with deposit growth after staying elevated over the past few quarters. In the second fortnight of November, credit offtake grew by 10.6% year-on-year while deposits grew by 10.7%.
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