Yes Bank Reports Robust Profit Growth Amid Strategic Adjustments

Yes Bank reported a 63% rise in quarterly net profit to Rs 738 crore, attributed to lower provisions. The bank aims for 12-15% loan growth, higher deposit growth, and plans to open 80 new branches annually over five years. Retail assets declined, focusing on safer loans.

Private sector lender Yes Bank announced a significant 63 percent increase in its net profit for the March quarter, reaching Rs 738 crore, primarily due to a reduction in provisions.

The bank, headquartered in a major city, also saw a 92.3 percent rise in its net profit for the 2024-25 fiscal year, totaling Rs 2,406 crore.

The core net interest income experienced a 5.7 percent growth, amounting to Rs 2,276 crore for the quarter, driven by an 8.1 percent increase in advances and a slight 0.1 percent rise in the net interest margin.

Yes Bank's total income grew to Rs 9,355.39 crore in the January-March quarter from Rs 9,015.77 crore during the same period last year, according to an exchange filing.

Despite concerns surrounding deposit growth, Yes Bank managed a 6.8 percent expansion in this area.

Managing Director and CEO Prashant Kumar indicated a target loan growth between 12-15 percent, with deposit growth expected to outpace loan growth.

The share of low-cost current and savings account balances increased to 34.3 percent from 30.9 percent the previous year.

While reducing savings account offerings by up to 2 percent, bringing the minimum interest rate to 3 percent, Kumar expressed confidence that the Casa ratio would remain unaffected.

The bank added 37 branches in FY25 and plans to open 80 branches annually for the next five years.

Non-interest income grew by 10.9 percent to Rs 1,739 crore during the quarter in question.

Provisions decreased by 32.5 percent year-on-year, amounting to Rs 318 crore, significantly contributing to profit growth.

In a strategic shift, retail assets declined as the bank moved away from car and home loans, focusing instead on more profitable and safer assets.

Yes Bank aims for up to 12 percent retail loan growth in the new fiscal year, prioritizing loans against property, business loans, and financing for used cars.

The retail sector faced fresh slippages totaling Rs 1,348 crore, with the majority originating from the segment, but credit card stress has begun to stabilize.

Yes Bank's credit deposit ratio decreased to 86.5 percent from over 88 percent, with plans to reduce it further to around 85 percent.

Overall capital adequacy stood at 15.6 percent as of March, with no current need for fresh capital, according to Kumar.

(With inputs from agencies.)