Kotak Mahindra Bank shares rise 2% after Q3 update shows 16% YoY growth in net advances

Kotak Mahindra Bank shares rise 2% after Q3 update shows 16% YoY growth in net advances

Private sector lender Kotak Mahindra Bank has reported a 2.7 percent on-year fall in its standalone net income at Rs 3,253 crore in the September quarter. However, its key net interest income (NII) grew and witnessed a healthier 16 per cent jump in net advances, but only to be whittled down by a massive 43.5 per cent spike in provisions. The Bank said Saturday that its provisions for bad loans and fresh slippages soared 43.5 percent to Rs 947 crore from a low of Rs 660 crore a year ago, while fresh slippages jumped to Rs 1,629 crore from Rs 1,812 crore, but recoveries and upgrades were lower at Rs 688 crore. The key profitability metric, net interest margin, contracted to 4.54 per cent from 4.65 per cent, the bank said Saturday in an exchange filing. Overall advances grew much faster than the industry at 16 per cent and deposits at 14 per cent. Among loan products, the credit card portfolio declined 14 per cent on-year to Rs 12,444 crore. Retail microcredit too dipped 41 per cent from a year ago to Rs 5,725 crore—both these segments have been the biggest pain-points for the bank for a few quarters now, and also for a few others like RBL and Axis Bank. All this is for information. This is not a buy/sell recommendation. Thank you, Technofunda24