Kotak Mahindra Bank’s Q3 profit rises

Kotak Mahindra Bank reported net profit of ₹3,005 crore, up 8% YoY in the December quarter. This was supported by a 16% rise in the net interest income to ₹6,554 crore. However, the net profit was lower than the street expectations of ₹3,250 crore.

Meanwhile, the net interest margin (NIM), which is a key measure of profitability, stood at 5.22% for Q3FY24 compared to 5.4%7 in Q3FY23.

The management pointed out that it had to set aside ₹143 crore as provisioning (post tax) in connection with RBI’s circular on Alternate Investment Funds.

The private bank’s asset quality improved with the net non-performing assets (NPAs) declining to 0.3% of the total loan book from 0.4% in the same period last year. Gross non-performing assets also dropped to 1.7% from 1.9% in the same period.

The loan growth stood at 19% year-on-year driven by unsecured retail lending and home loans. The unsecured retail loans increased to 11.6% of the loan book from 9.3%.

Meanwhile CASA, which is the cheapest source of funds, declined to 47.7% of the total deposits from 53.3% in the same quarter last year.