HDFC Bank Q4: From Interest Income, Provisions, Hiring To Asset Quality, 10 Key Highlights Of The Quarter

The bank's stock will be in focus on Monday after the Q4 earnings.

Here are the 10 key takeaways from the quarter:

1. Net profit:

In Q4FY23, the bank posted a profit before tax of ₹15,935.5 crore. But after providing t 3,888.1 crore for taxation, the Bank earned a net profit of ₹12,047.5 crore, an increase of 19.8% over the quarter that ended March 31, 2022.

For the full year, net profit stood at ₹44,108.7 crore, up 19.3% YoY.

2. Top-line front:

Net interest income (NII) which is the difference between interest earned less interest expended, in Q4FY23, climbed by 23.7% to ₹23,351.8 crore from ₹18,872.7 crore in Q4FY22. Core net interest margin was at 4.1 % on total assets, and 4.3% based on interest-earning assets.

Its revenue stood at ₹32,083.0 crore for the fourth quarter, rising by 21% YoY.

Overall, in FY23, the bank posted a total income of ₹192,800.4 crore as against ₹157,263.0 crore for the year ended March 31, 2022. Net revenues (net interest income plus other income) for the year ended March 31, 2023, were ₹118,057.1 crore, as against ₹101,519.5 crore for the year ended March 31, 2022.

3. Advances:

By end of the March 2022 quarter, the lender's total advances stood at ₹1,600,586 crore, an increase of 16.9% YoY. In terms of segment-wise, domestic retail loans grew by 20.8%, commercial and rural banking loans grew by 29.8%, and corporate and other wholesale loans grew by 12.6%. Overseas advances constituted 2.6% of total advances.

4. Retail loans:

HDFC Bank's total retail advances stood at ₹634,578 crore versus ₹531,767 crore in Q4FY22. Of the total, the bank's home loan products crossed ₹1 lakh crore mark, and came in at ₹102,067 crore in Q4FY23, while personal and auto loans stood at ₹171,676 crore and ₹117,429 crore respectively. Payment Products came in at ₹86,104 crore, loans against property were at ₹76,773 crore, two-wheeler loans posted ₹9,933 crore, and gold loans stood at ₹10,842 crore. Other retail loans recorded ₹59,754 crore in Q4FY23.

5. Deposits:

The bank witnessed healthy growth in terms of total deposits which came in at ₹1,883,395 crore by end of Q4FY23, an increase of 20.8% over March 31, 2022.

CASA deposits grew by 11.3% with savings account deposits at ₹562,493 crore and current account deposits at ₹273,496

crore. Time deposits were at ₹1,047,406 crore, an increase of 29.6% over the corresponding quarter of the previous year, resulting in CASA deposits comprising 44.4% of total deposits as of March 31, 2023.

6. Provisions:

The bank's provisions and contingencies dropped sharply to ₹2,685.4 crore as against t 3,312.4 crore in Q4 of FY22.

Pre-provision Operating Profit (PPOP) was at ₹18,620.9 crore in Q4FY23. PPOP, excluding net trading and mark-to-market income, grew by 14.4% over the quarter that ended March 31, 2022.

7. Asset quality:

In terms of asset quality, HDFC Bank's gross NPA declined to 1.12% of gross advances in Q4FY23 as against 1.23% in Q3FY23 and 1.17% in Q4FY22. The Q4FY23 gross NPA is excluding 0.94% NPAs in the agricultural segment, which stood at 1% and 1.01% in Q3FY23 and Q4FY22.

Net non-performing assets were at 0.27% of net advances as of March 31, 2023.

8. Capital Adequacy:

The lender's total Capital Adequacy Ratio (CAR) as per Basel Ill guidelines was at 19.3% as against a regulatory requirement of 11.7%. This also includes a Capital Conservation Buffer of 2.5% and an additional requirement of 0.2% on account of the Bank being identified as a Domestic Systemically Important Bank (D-SIB).

Tier 1 CAR was at 17.1% as of March 31, 2023, compared to 17.9% as of March 31, 2022.

Risk-weighted Assets were at ₹1,586,635 crore in the latest quarter.

9. Dividend:

The bank's board recommended a dividend of ₹19.0 per equity share having a face value of Re 1 each, as against ₹15.5 per equity share paid in the previous fiscal.

10. Network:

As of March 31, 2022, HDFC Bank's distribution network was at 7,821 branches and 19,727 ATMs / Cash Deposit & Withdrawal Machines (CDMs) across 3,811 cities/towns as against 6,342 branches and 18, 130 ATMs / CDMs across 3, 188 cities/ towns as of March 31, 2022.

52% of its branches are in semi-urban and rural areas. Also, the bank has 15,921 business correspondents, which are primarily manned by Common Service Centres (CSC).

The bank made a net addition of 31,643 employees to 173,222 for the period ending March 31, 2023, compared to 141,579 as of March 31, 2022.