Axis Bank net profit at Rs 1,683 Cr - displays strong performance in Q2

Axis Bank reports 51 % QoQ growth in Net Profit. Net Interest Income up 20% YoY, NIM up 18 bps QoQ, Fees up 67% QoQ, Operating Profit up 16% YoY. Total Deposits grew 13% YoY, CASA ratio up 536 bps YOY, Loan book grew by 14% YoY. Net NPA stood at 0.98%, which indicates improvement in asset quality. Market share in UPI (20%) and Mobile banking (18%) was up 800 bps each YoY, Card spends up 49% QoQ. Capital adequacy ratio (including H1 profit) at 19.38%, CET 1 ratio improved by 188 bps QoQ to 15.38%.

Amitabh Chaudhry, MD and CEO, Axis Bank said “The last quarter was an extremely fulfilling one. Keeping the customer journey at the centre of all our innovations and solutions, Axis Bank came up with some great initiatives to suit the current times. Axis Bank has now gone to the next level of digital with Video KYC and other tech enabled solutions like the AXAA multilingual BOT. As Bank looks forward to an upbeat festive season, management have ensured that our ‘Dil Se Open Celebrations’ have something for everyone.”

Results at glance:

Strong operating performance, net profit at 1,683 cr, compared to loss YoY:

1) Net Interest Income in Q2 FY21 grew 20% YOY to Rs 7,326 cr, NIM stood at 3.58% in Q2 FY21
2) Fee income grew 67% QoQ and 4% YoY, Retail fee income grew 82% QoQ and 0.5% YoY while corporate & commercial banking fee grew 46% QoQ and 10% YoY
3) Operating profit for Q2 FY21 grew by 16% YoY to Rs 6,898 cr; PAT for the quarter stood at Rs 1,683 cr

Steady growth in Deposits continues to drive Loan growth:

1) Total deposits grew 13% YoY on quarterly average basis (QAB)
2) Savings Account deposits grew 15% YoY, Current Account deposits grew 18% YoY and Retail Term Deposits (RTD) were up 25% YoY on QAB basis.
3) CASA + RTD deposits ratio improved by 536 bps YoY and 357 bps QoQ to 84%

Performance improving across business segments

1) Retail loans grew 12% YoY and 2% QoQ
2) 80% of Retail book is secured, home loans constitute 36% with average LTV’s of 50% to 60%
3) Corporate loans (including TLTRO investments) grew 22% YoY, SME loan book grew 6% QoQ

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Digital is the new way to bank at Axis

1) Bank solidifies its position in Digital payments space with 20% market share in UPI transactions and 18% in Mobile Banking during the quarter; total Card spends up 49% QoQ
2) Share of digital channels in sourcing FDs and personal loan disbursements in H1 stood at 73% and 58%