RBI Ban Impacts IIFL Finance's Quarterly Profit with 28% Decline

IIFL Finance reported a 28% decline in consolidated profit for the June quarter FY25, amounting to Rs 338 crore, due to the RBI's prohibition on its gold loan business. This compares to the Rs 473 crore profit earned in the same quarter last year. Total income saw an increase, albeit with higher expenses and deteriorating asset quality.

IIFL Finance has faced a significant financial setback, posting a consolidated profit decline of 28% to Rs 338 crore for the June quarter of FY25, as compared to Rs 473 crore in the same period last year. This decline follows the Reserve Bank of India's decision to halt the company's gold loan disbursements, citing major supervisory concerns.

The company's total income for the quarter grew to Rs 2,625 crore from Rs 2,370 crore last year. Interest income specifically saw a rise to Rs 2,472 crore, up from Rs 2,198 crore in the previous year's first quarter. However, expenses also surged from Rs 888 crore to Rs 1,034 crore.

Asset quality took a hit, with gross non-performing assets (NPAs) escalating to 2.25% from 1.8% at the end of June 2023. Net NPAs remained unchanged at 1.1% of advances by June 2024.

(With inputs from agencies.)