Mumbai: RBL Bank on Thursday reported a 6 per cent rise in net profit led by growth in net interest income (NII) despite a rise in expenses as the bank increased its branch presence during the quarter.
Net profit rose to Rs 156 crore in the quarter ended December 2021 from Rs 147 crore a year earlier mainly due to a 11 per cent growth in NII to Rs 1,010 crore from Rs 908 crore a year earlier.
Total operating expenses rose 46 per cent to Rs 1,000 crore in December 2021 from Rs 683 crore a year earlier reflecting the increase in operation, technology, people and compliance costs as the bank added 90 branches between September 2021 and January 2022 to take total branches beyond 500.
A 16 per cent rise in wholesale loans made up for the 6 per cent fall in retail loans as the bank consciously went slow on micro finance and small business loans due to the uncertainty caused by the rise in Covid infections during the quarter.
CEO Rajeev Ahuja said he expects retail loans to pick up next fiscal in line with the economic recovery and as the bank uses its expanded presence to ramp up loans including in micro finance.
The bank’s advances increased 3 per cent year on year to Rs 58,141 crore. Retail loans make up 53 per cent of the bank’s loan book and Ahuja expects it to increase to more than 60 per cent in the next three years.
“As the stress from the pandemic abates and with the overall improvement in the economic environment, we are confident of continuing and improving this performance over the next fiscal,” Ahuja said.
Within retail space, the bank issued 6 lakh credit cards during the quarter – more than 80 per cent higher than its normal run rate.
RBL’s long time CEO Vishwavir Ahuja proceeded on unspecified leave on Christmas Day, following which executive director Rajeev Ahuja was appointed CEO. The RBI has also appointed its chief general manager Yogesh Dayal as an additional director on the bank’s board for a period of two years, though the central bank has not said on what led to this dramatic action. Ahuja had been at the helm at RBL since June 2010.
The bank board has formed a four member committee including Pradip Shah, Chairman, National Asset Reconstruction Company Ltd. (NARCL) as an external member to work with board members Manjeev Singh Puri, Ishan Raina and Veena Mankar to find a new CEO. Executive search firm EgonZehnder has also been appointed to find a new CEO.
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