Axis Bank has announced its financial results for the December quarter, showcasing a steady operational performance with a net profit increase of 3% year-on-year, reaching Rs 6,490 crore. This growth was primarily supported by strong loan expansion and higher fee income, even as net interest margins saw a moderation.
Financial Highlights and Performance Metrics
The bank's net interest income rose by 5% from the same period last year to Rs 14,287 crore. This improvement was driven by a significant 14% growth in advances, which totaled Rs 11,59,052 crore. On the lending front, corporate loans surged by 27% year-on-year, while loans to small and medium enterprises (SMEs) grew by 22%. However, retail loans, which constitute the bulk of the bank's advances, experienced a slower growth rate of only 6%.
Margin Trends and Management Insights
Net interest margin moderated to 3.64% from 4.06% in the year-ago quarter. The bank management attributed the decline in the share of retail loans to a strategic decision to slow down disbursements due to past stress in certain segments. They noted that retail disbursements have since picked up, indicating a potential recovery in this area.
Deposit Growth and Balance Sheet Expansion
Total deposits increased by 15% to Rs 12,60,786 crore, with current and savings accounts (CASA) deposits rising by 14%. The bank's balance sheet expanded by 15% to Rs 17,52,171 crore, reflecting overall growth in its financial operations.
Overall Income and Operational Strength
Total income from operations saw a 5% increase to Rs 20,512 crore, underscoring the bank's robust performance in the quarter. Despite challenges in margins, Axis Bank's ability to maintain profit growth highlights its resilience and strategic focus in a competitive banking environment.
