Bandhan Bank Q4: Profit Increases 483% on Lower Provisions, But Core Revenue Stream Contracts

Bandhan Bank has reported a considerable increase in its net profit for the fourth quarter of the financial year 2024-25, primarily supported by a substantial reduction in provisions. The private sector lender's profit after tax (PAT) jumped by a remarkable 483% year-on-year to ₹318 crore for the March 2025 quarter, compared to ₹55 crore in the corresponding period of the previous fiscal year. This strong profit performance was aided by lower provisions and improved asset quality.

However, the bank's net revenue experienced a slight contraction, slipping 3% to ₹3,456 crore in Q4 FY25, down from ₹3,560 crore in Q4 FY24. This decline was mirrored in the Net Interest Income (NII), a key measure of profitability from lending operations, which saw a 4% year-on-year de-growth. NII stood at ₹2,756 crore in Q4 FY25, compared to ₹2,859 crore in Q4 FY24. The bank's operating profit also decreased, coming in at ₹1,571 crore in Q4 FY25 versus ₹1,838 crore in Q4 FY24.

Provisions and Asset Quality

A crucial factor contributing to the profit jump was the significant drop in provisions (other than tax) and contingencies charged to the profit and loss account. These were notably lower at ₹1,260 crore in Q4 FY25, compared to ₹1,774 crore in Q4 FY24.

Collection efficiency for EEB loans (Emerging Entrepreneurs Business loans) was reported at 97.8% for Q4 FY25, a slight uptick from 97.4% in Q3 FY25. The provision coverage ratio (including technical write-offs) stood at 86.5% as of March 2025, up from 84.5% in the previous year. Excluding technical write-offs, the PCR was 73.7%.

Deposits and Advances Growth

Total deposits grew by 12% year-on-year to ₹1.51 lakh crore as of March 31, 2025, up from ₹1.35 lakh crore in the previous year. CASA (Current Account Savings Account) deposits amounted to ₹47,437 crore, resulting in a CASA Ratio of 31.4%. The ratio of CASA plus Retail Term Deposits to total deposits was approximately 69%.

Gross advances also registered a 10% year-on-year increase, reaching ₹1.37 lakh crore as of March 2025, compared to ₹1.25 lakh crore in the previous year. The bank highlighted strong growth in specific segments, with the retail book (other than housing) expanding by 98% year-on-year and Wholesale Banking growing by 35% year-on-year. The housing book showed growth of 11% year-on-year, or 18% year-on-year excluding IBPC (Inter-Bank Participation Certificates, though not explicitly defined).

Dividend Recommendation

The bank's Board of Directors recommended a dividend of ₹1.50 per equity share with a face value of ₹10 each, representing a 15% dividend from the profits for the financial year ended March 31, 2025. This recommendation is subject to approval by the shareholders at the upcoming Annual General Meeting (AGM).

Market Performance

The Bank’s Share closed at ₹165, with a slight decline of 1.73%.

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