HDFC Bank Reports 18% Rise In Q2 Profit; Names New CEO

On Saturday, HDFC Bank reported an 18 percent increase in its net profit for the September ended quarter at Rs 7,513.11 crore from Rs 6,344.99 in the same period a year ago.

The bank's net interest income (NII), that is the difference between interest earned on advances and interest distributed on deposits, grew by 16.7 percent during the June-September period to Rs 15,776.4 crore from Rs 13,515 crore in the same period last year, driven by asset growth of 21.5 percent and core net interest margin of 4.1 percent during the quarter.

Asset quality

The gross and net NPAs (non-performing assets) were at 1.08 percent of the gross advances and 0.17 percent of the net advances as on 30 September 2020, respectively, the bank said in its stock exchange filing.

"The Honourable Supreme Court of India, in a public interest litigation (Gajendra Sharma Vs Union of India & Anr), vide an interim order dated September 03, 2020), directed that accounts which are not declared NPA till August 31, 2020 shall not be declared as such until further orders. Pursuant to the said interim order, accounts that would have otherwise been classified as NPA have not been and will not be, classified as NPA till such time that the Honourable Supreme Court rules finally on the matter," HDFC Bank said.

The Bank continues to hold provisions of Rs 1,451 crore and contingent provisions of Rs 6,304 crore as on 30 September 2020. Total provisions were 195 percent of the reported gross NPAs or 154 percent of the proforma gross NPAs as on 30 September 2020.

The private lender also informed that its Board has approved the appointment of Sashidhar Jagdishan as the Managing Director and Chief Executive Officer of the Bank, subject to the approval of the shareholders of the Bank, for a period of three years from 27 October 2020.

CEO

Jagdishan will replace retiring CEO Aditya Puri Puri, who has been credited for the building the brand that is now the most valuable private bank in India.

Jagdishan joined HDFC Bank in the year 1996 as a Manager in the Finance function. He became Business Head - Finance in 1999 and was appointed as Chief Financial Officer in the year 2008. Prior to his appointment as Managing Director & CEO of the Bank, he was the Strategic Change Agent of the Bank in addition to overseeing the functions of Finance, Human Resources, Legal & Secretarial, Administration, Infrastructure, Corporate Communications and Corporate Social Responsibility.