IndusInd Bank Faces Profit Decline Amid Asset Quality Concerns
IndusInd Bank reported a 40% decline in net profit for the September quarter, driven by asset quality concerns and challenges in microlending. The bank set aside additional provisions of Rs 525 crore and saw a dip in net interest income. CEO Sumant Kathpalia remains optimistic about future performance.
- Country:
- India
IndusInd Bank reported a 40% decline in net profit to Rs 1,331 crore for the September quarter, heavily impacted by asset quality concerns. The bank has allocated an additional Rs 525 crore in provisions due to an uncertain operating environment.
The decline in profitability was linked to lower interest income caused by increased slippages and a reduction in the microlending portfolio. Despite two consecutive quarters of unmet business targets, CEO Sumant Kathpalia expressed confidence in the bank's future trajectory.
The bank's core net interest income recorded a mere 5% growth against a 13% loan growth and a net interest margin contraction to 4.08%. Focus remains on stabilizing loan growth and interest margins, as Kathpalia highlighted the bank's strategic shifts in microfinance and unsecured loans.
(With inputs from agencies.)
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