Synopsis
• Scheduled Commercial Banks’ (SCBs) net profit grew by 33.4% y-o-y to Rs. 0.77 lakh crore for Q2FY24 due to robust growth in Pre-Provisioning Operating Profit (PPOP) and lower provisions.
o Private Sector Banks (PVBs) posted robust growth of 35.1% y-o-y to Rs. 0.42 lakh crore in Q2FY24.
Public Sector Banks (PSBs) too reported strong net profit growth of 31.4% y-o-y to Rs. 0.35 lakh crore.
• Return on Assets (RoA, annualised) of SCBs improved by 17 bps y-o-y to 1.28% in Q2FY24. However, banks faced marginal pressure and declined by 1 bps on a sequential basis due to higher growth in advances, rising cost of deposits, reduction in low-cost CASA deposits and seasonality impact.
• SCBs were adequately capitalised in Q2FY24. PSBs’ median Common Equity Tier- 1 (CET-1) ratio expanded by 140 bps y-o-y to 13.7% in the quarter due to robust growth in profitability, while median CAR expanded by 87 bps y-o-y to 16.6% on account of profitability and accessing the debt market issuance.
