Axis Bank Q4FY19 Results: Profit reaped! Key takeaways

Axis Bank turned losses into profit during March 2019 quarter (Q4FY19). It bagged a net profit of Rs 1,505.06 crore compared net loss of Rs 2,188.74 crore posted a year ago same period. However, Q4FY19 PAT was down by 10.45% from Rs  1,680.85 crore. NII was at Rs 5,705.59 crore in the latest quarter versus loss of Rs 2,788.66 crore in Q4FY18. For FY19, net profit stood at Rs 4,677 crores, while NII grew by 17% YOY to Rs 21,708 crores. Net interest margin for Q4FY19 stood at 3.44%, NIM for FY19 stood at 3.43%.

Here's a key highlight from Axis Bank's Q4FY19 result!

Loans!

The Bank’s Balance Sheet grew 16% YOY and stood at Rs 8,00,997 crores as on 31st March 2019. The Bank’s Advances grew 13% YOY to Rs 4,94,798 crores as on 31st March 2019. Domestic loans grew 18% while the overseas book de-grew by 29%. Retail loans grew 19% YOY to Rs 2,45,812 crores and accounted for 50% of the Net Advances of the Bank. SME loans grew 12% YOY to Rs 65,584 crores. Corporate loan book grew by 5%, with domestic corporate loan book up 17%. The Bank’s loan to deposit ratio stood at 90% as against 92% at the end of Q3FY19.

Investments, deposits!

Book value of the Bank’s Investments portfolio as on 31st March 2019, was Rs 1,74,969 crores, of which Rs 1,20,239 crores were in government securities, while Rs 40,169 crores were invested in corporate bonds and Rs 14,561 crores in other securities such as equities, preference shares, mutual funds, etc. Total deposits on quarterly average basis (QAB) grew by 24%. CASA and Retail Term Deposits on a QAB basis put together recorded a growth of 21% YOY. On a period end basis, the total deposits grew 21% YOY. The share of CASA and Retail Term Deposits in the Total Deposits stood at 81% as on 31st March 2019. 

Capital Adequacy and Shareholders’ Fund!

Shareholders’ funds of the Bank stood at Rs 66,676 crores as on 31st March 2019. The Bank is well capitalised. Under Basel III, the Capital Adequacy Ratio (CAR) and Tier I CAR as on 31st March 2019 was 15.84% and 12.54% respectively.

Asset Quality!

Bank has recognised slippages of Rs 3,012 crores during Q4FY19, compared to Rs 3,746 crores in Q3FY19 and Rs 16,536 crores in Q4FY18. Corporate lending slippages stood at Rs 1,369 crores. 72% of this came from disclosed BB & below accounts. The Bank’s BB and below-rated book stood at Rs 7,467 crores. This is 1.3% of the Bank’s Gross Customer Assets, significantly down from 7.3% at peak. As on 31st March 2019, the Bank’s Gross NPA stood at Rs 29,789 crores and Net NPA stood at Rs 11,276 crores. Recoveries and upgrades from NPAs during the quarter were Rs 2,376 crores while write-offs were Rs 1,701 crores. Net slippages (before write-offs) in Retail and SME stood at Rs 215 crores and Rs 189 crores respectively.

The Bank’s provision coverage, as a proportion of Gross NPAs including prudential write-offs, stood at 77% up from 75% in Q3FY19.

Network!

In Q4FY19,  the Bank added 86 branches to its network across the country, taking the tally of new branches opened during FY19 to 347 branches. As on March 2019, the Bank had a network of 4,050 domestic branches and extension counters situated in 2,366 centres compared to 3,703 domestic branches and extension counters situated in 2,163 centres last year.  The Bank had 11,801 ATMs and 4,917 cash recyclers spread across the country.

Digital!

Mobile banking transaction volumes surged by 183% YOY while the mobile spends in Q4 reported a growth of 89% YOY primarily led by surge in UPI (Unified Payment Interface) transactions. Axis Bank currently has a 45 million registered UPI customer base. During the quarter, Axis Bank processed over 246 million UPI transactions with a total transaction value in Q4 growing over 4 times YOY to Rs 30,331 crores. Credit card usage witnessed growth of 26% YOY in value terms. The share of digital transactions in the overall transaction mix for the Bank remained strong at 77% as at end of March 2019.