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Axis Bank reports Q4 loss larger than expected due to Citi deal
Axis, India's fourth-largest bank by market capitalisation, in March closed a deal to acquire Citigroup Inc's local consumer and non-banking finance businesses.
India's Axis Bank Ltd on Thursday reported a wider-than-expected one-time loss in the fourth quarter, weighed down by costs incurred due to its $1.41 billion Citi deal. Axis reported a loss of 57.28 billion rupees for the three months ended March 31, compared to a profit of 41.18 billion rupees a year earlier. Analysts had forecast the bank to report a loss of 8.06 billion rupees, according to Refinitiv IBES data.
Axis, India's fourth-largest bank by market capitalisation, in March closed a deal to acquire Citigroup Inc's local consumer and non-banking finance businesses.
Despite the loss, the lender's business growth remained robust.
It reported a standalone operating profit, which excludes provisions and contingencies, of 91.68 billion rupees, compared to 64.66 billion rupees a year earlier.
The bank's net interest income, the difference between interest earned and expended, grew 33% to 117.42 billion rupees. Net interest margins were at 4.22%, up 73 basis points year-on-year.
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Larger rivals HDFC Bank and ICICI Bank have also reported healthy growth in net interest incomes for the fiscal fourth quarter.
Axis' quarterly advances were up 19% year-on-year, in line with double-digit loan growth seen in Indian banks over the last few months.
The Mumbai-based bank's deposits grew 15%.
Meanwhile, the bank's gross bad loans as a percentage of total loans, a measure of asset quality, improved to 2.02% from 2.38% in the last quarter. Its net non-performing assets ratio was at 0.39% as compared with 0.47% in the prior quarter.
Provision and contingencies for the quarter stood at 3.06 billion rupees, down from 9.87 billion rupees a year ago.
