Yes Bank Q2 Results FY22

Yes Bank beat the market estimates with its performance in the second quarter of FY22. The bank posted a 74% YoY jump in its net profit to Rs. 225 crores in Q2 FY22 compared to Rs. 129 crores in the year-ago period. The sharp spike in the PAT came on the back of a sharp decline in the provisions of the bank and improved asset quality. The bad debt provisions fell by 65% YoY and amounted to Rs. 377 crores in the quarter under review.

Nonetheless, Yes Bank’s net interest income was reduced by 23.4% YoY and amounted to Rs. 1512 crores at the end of the second quarter of FY22. The net interest margin fell alongside, to 2.2% in the second quarter, compared with 3.1% in the last quarter. However, the public sector bank’s non-interest income jumped by 30% YoY and amounted to Rs.778 crores.

Operating profits suffered a setback. The operating profit reduced 45.8% YoY and stood at Rs.678 crores in Q2. This is being attributed to the increased business activity in the quarter. In line, the operational expenses for the bank reflect a 5% increase in QoQ and stand at Rs.1612 crores at the end of September 2021 (Q2 FY22). 

The silver lining is the bank’s Gross Non-Performing Assets (GNPA) ratio that reduced 15% sequentially. The Non-Performing Asset (NPA) ratio also reduced by 0.3% from the last quarter and stood at 5.5%.

The bank has managed to bring overdue loans, on which the repayments were pending for more than 30 days but less than 90 days, under control. These loans witnessed a reduction by Rs. 6000 crores on a QoQ basis. The bank’s gross restructured loans amounted to Rs. 6184 after the end of the second quarter. The composition of retail loans grew by 100 basis points on a QoQ basis and stood at 55% after the second quarter. 

The CASA ratio for Yes Bank improved to 29.4% in the second quarter against 27.4% in the June quarter. Deposits grew by 30% YoY showing the increased confidence of customers.

Hits

• 74% YoY jump in the net profit, from Rs. 129 crores to Rs. 225 crores
• 65% YoY reduction in bad debt provisions
• 30% YoY jump in the non-interest income which stood at Rs.778 crores

• 15% sequential reduction in the GNPA ratio. The NPA ratio also reduced from 5.8% last quarter to 5.5% this quarter 

• Overdue loans reduced by Rs.6000 crores sequentially

• Growth of 100 bps YoY in the bank’s composition of retail loans which now stand at 55%

• CASA ratio rose to 29.4% this quarter compared to 27.4% last quarter

• 3.5% YoY and 5.6% QoQ jump in advances

• 30% YoY jump in deposits