Mumbai: HDFC bank There has been a significant increase in loans restructured under covid relief plan. Analysts worry that a large part of these loans could turn into non-performing assets (NPAs).
On the positive side, the bank has reported an improvement in gross NPA The ratio of 12 basis points (100bps = 1 percentage point) on a quarter to quarter basis is 1.35%. Its subsidiary HDB Financial Services also posted a growth of 6.1 per cent in GNPA from 7.8% in the same quarter last year.
“However, the restructuring pool for the bank increased sharply quarter-on-quarter to Rs 20,300 crore (1.7% of the loan versus 0.68% in Q1), mainly due to liberal restructuring in the personal loan book. As a prudent strategy, the bank made an additional provision of Rs 1,200 crore in the second quarter and now carries a contingency plus floating buffer of Rs 9,200 crore (0.8% of the loan),” said Anand Dama MKU Global in a research note.
Addressing analysts on Saturday, HDFC bank chief loan officer Jimmy Tata The restructured loans are considered while making provision. If there is another setback, the balance sheet needs to be more resilient, historically we have been conservative and our stance does not change.
He said the bank was monitoring the restructured loan portfolio based on both pre and post behavior of the borrower. “We don’t think the impact on our NPAs will be more than 10-20 bps at any point of time,” he said.
The country’s largest private lender on Saturday reported a net profit of Rs 8,834 crore for the quarter ended September 2021, up 18% over the previous year.
On the positive side, the bank has reported an improvement in gross NPA The ratio of 12 basis points (100bps = 1 percentage point) on a quarter to quarter basis is 1.35%. Its subsidiary HDB Financial Services also posted a growth of 6.1 per cent in GNPA from 7.8% in the same quarter last year.
“However, the restructuring pool for the bank increased sharply quarter-on-quarter to Rs 20,300 crore (1.7% of the loan versus 0.68% in Q1), mainly due to liberal restructuring in the personal loan book. As a prudent strategy, the bank made an additional provision of Rs 1,200 crore in the second quarter and now carries a contingency plus floating buffer of Rs 9,200 crore (0.8% of the loan),” said Anand Dama MKU Global in a research note.
Addressing analysts on Saturday, HDFC bank chief loan officer Jimmy Tata The restructured loans are considered while making provision. If there is another setback, the balance sheet needs to be more resilient, historically we have been conservative and our stance does not change.
He said the bank was monitoring the restructured loan portfolio based on both pre and post behavior of the borrower. “We don’t think the impact on our NPAs will be more than 10-20 bps at any point of time,” he said.
The country’s largest private lender on Saturday reported a net profit of Rs 8,834 crore for the quarter ended September 2021, up 18% over the previous year.
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