YES Bank beats St estimate, net jumps 38%: All you need to know

Private sector YES Bank brought some cheer to Dalal St on a day when the bank Nifty touched a 10-month low and the Sensex tanked 300 points.

The bank reported better-than-expected earnings for the first quarter of FY14. The bank’s net profit rose 38 percent year on year to Rs 401 crore, driven by net interest income and non-interest income.

Analysts had on an average expected the private bank to report a net profit of Rs 382 crore.

[caption id=“attachment_981807” align=“alignleft” width=“380”] Yes Bank beat St estimates[/caption]

Net interest income increased 39.6 percent (3.3 percent sequentially) to Rs 659 crore in April-June quarter from Rs 472 crore reported in a year ago period, in line with Street expectations.

The bank’s asset quality also improved as the gross non performing assets stood at 0.22 percent of net advances in the June quarter against 0.20 percent in the previous quarter, while net NPA came in at 0.03 percent against 0.01 percent in the previous quarter.

Other income jumped 53.47 percent year-on-year (16.5 percent Q-o-Q) to Rs 442 crore in first quarter while net interest margin was unchanged at 3 percent Q-o-Q, but improved by 20 bps Y-o-Y. The growth in non-interest income was on the back of continued growth in financial advisory, transaction banking, financial markets and retail banking fees.

Commenting on the results, Rana Kapoor, Managing Director & CEO, YES Bank said, “YES BANK has witnessed steady growth in Net Profit of 38.1%, on the back of strong NII, and continued focus on revenue diversity leading to a healthy increase in Non-Interest Income. The Bank has continued the strong traction on CASA & retail deposits with its CASA ratio crossing 20% for the first time since inception. Improved productivity, a wider and deeper branch network and continued focus on customized product offerings, have led to further growth of retail customers.”

Following are the highlights:

•CASA Ratio has improved to 20.2% from 16.3% a year ago; CASA grew at 61.1% y-o-y with Savings Accounts deposits increasing by 120.6% y-o-y

•45 branches added in the quarter taking total branches to 475; ATM count crosses 1,000

•Loan Growth steady at 24.3% y-o-y, with Deposit growth at a healthy 29.9% y-o-y

•As per Basel III, Tier I Capital steady at 9.5%; Total Capital Adequacy at 15.4%

•RoA at 1.6% and has been at or above 1.5% over the last 5 years, and RoE at 26.7% continues to be at or above 20% over the same period

•Customer Assets (loans and credit substitutes) stood at Rs 61260 crore as at June 30, 2013; a growth of 24.2% year-on-year

•Advances stood at Rs 4790 crore as at June 30, 2013; growth of 24.3% y-o-y

• Deposits stood at Rs 6524 crire as at June 30, 2013; growth of 29.9% y-o-y

• Gross NPA at 0.22% of Gross Advances; Net NPA at 0.03% of Net Advances

•Employee strength stood at 7,458 as on June 30, 2013; an increase of 1,275 employees overJune 30, 2012.

• Corporate & Institutional Banking (Large Corporates) accounted for 64.3 percent of the Customer Assets portfolio, Commercial Banking (Mid-sized Corporates) accounted for 18.6 percent and Retail Banking (including MSME) accounted for 17.1 percent.