In a significant development, HDFC Bank has released its first earnings report since its merger with HDFC. The merger has resulted in consolidated net revenues of ₹66,317 crore for the second quarter. Impressively, the merged entity has achieved a consolidated net profit of ₹16,811 crore as of September end.
The gross non-performing assets (NPAs) of the merged balance sheet are at ₹31,577 crore, accounting for 1.34% of gross advances. However, on a proforma merged basis, the gross NPAs stood at 1.41% as of June 30, 2023. It should be noted that prior to the merger, the gross NPAs were 1.23% in September 2022.
The net NPAs represent 0.34% of the net advances for the second quarter. While it is challenging to compare these figures to previous quarters due to the merger, it is worth highlighting that net profits have increased by an impressive 114%, and net profits have risen by 51.1% on a year-on-year basis.
Another positive outcome of the merger can be seen in the growth of total deposits, which experienced an approximate increase of ₹1.1 lakh crore during the quarter. As of September end, the total deposits stood at ₹21,72,858 crore.
Looking at provisions and contingencies, the bank reported ₹2,904 crore for the quarter, which is lower compared to the previous year’s same quarter provision of ₹3,240 crore. This highlights the bank’s improved financial performance post-merger.
It is worth noting that the bank’s capital adequacy ratio stands at an impressive 19.5% as compared to the regulatory requirement of 11.7%. Additionally, the total credit cost ratio for the quarter is at 0.49%, demonstrating better risk management compared to the same quarter last year when the ratio was 0.87%.
The successful merger has led to a substantial increase in the bank’s total balance sheet, which now stands at ₹34,16,310 crore compared to ₹22,27,893 crore in the previous year. These figures portray the strengthened position of HDFC Bank in the financial market after its merger with HDFC.
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