India’s second-largest private sector lender HDFC Bank on Monday posted a 33% year-on-year rise in net profit at Rs1,115 crore for the quarter ended March on the back of healthy growth in interest income.
The bank had reported a profit of R837 crore last year.
In order to attract retail investors, the management also approved the sub-division (split) of one equity share of the bank with a nominal value of Rs10 each into five equity shares of nominal value of Rs2 each.
“We expect our credit growth to be few percentages points more than the industry growth in the next financial year,” said Paresh Sukthankar, executive director, HDFC Bank. He expects credit growth in the banking sector to be around 20% in 2011-12.
For the full year 2010-11, the bank’s net profit grew 33% to 3,926 crore. Net interest income (the difference between interest earned and interest paid) of the bank grew 21 % to Rs2,840 crore during the quarter, driven by a healthy loan growth of 27%.
Other income (non-interest revenue) for the January-March quarter stood at Rs1256 crore, primarily contributed by fees and commissions of Rs1,000 crore.
The bank also improved its asset quality as gross non-performing asset stood at 1.1% at the end of the fourth quarter against 1.4% in year-ago period.
“The share split will make our company’s stock affordable to retail investors, which will increase shareholding of retail investors,” Sukthankar said Shares of the bank closed at Rs2,315 on the Bombay Stock Exchange, down by around 2%.