IDFC First Bank Reports Q3 Results for FY25
Today, IDFC First Bank announced its results for the third quarter of the financial year 2025. Unfortunately, the bank has reported a significant decline in its standalone net profit, dropping by 52.6 percent during the October to December period. The profit for this quarter stands at Rs 339.4 crore, which is a stark contrast to the Rs 715.7 crore profit recorded in the same quarter last year. Last Friday, the situation worsened as the bank’s shares fell 1.32 percent, closing at Rs 62.27 on the Bombay Stock Exchange (BSE).
Growth in Net Interest Income
On a brighter note, IDFC First Bank saw its net interest income (NII) grow by 14.4 percent, reaching Rs 4,902 crore in this quarter. This is an increase from Rs 4,286.6 crore reported during the same time last year. However, the bank’s Net Interest Margin (NIM) decreased slightly to 6.04% in Q3FY25, down from 6.18% in the previous quarter. This decline is attributed to a decrease in the micro-finance business and a rise in the wholesale banking segment. Moreover, the operating income for the December quarter increased by 15 percent, amounting to Rs 6,682 crore, compared to Rs 5,803 crore last year.
Operating Expenses and Core Operating Profit
Despite the growth in income, operating expenses also saw an increase of 16 percent year-on-year, rising from Rs 4,241 crore in Q3FY24 to Rs 4,923 crore in Q3FY25. When looking at the nine-month performance of FY25, operating expenses increased by 18.2 percent overall. Interestingly, the micro-finance business contributed significantly to a 15 percent growth in core operating profit, which rose from Rs 1,515 crore in Q3FY24 to Rs 1,736 crore in Q3FY25. This shows that while some areas are struggling, there are still pockets of growth within the bank.
CEO’s Insights on Bank’s Performance
V Vaidyanathan, the Managing Director and CEO of IDFC First Bank, expressed optimism about the bank’s ongoing performance. He highlighted that the bank has achieved considerable growth in both loans and deposits, with customer deposits rising by 29 percent year-on-year to Rs 2,27,316 crore. The CASA ratio remains strong at 48%, and loans and advances have increased by 22 percent annually, reaching Rs 2,31,074 crore. Vaidyanathan also emphasized the bank’s focus on monitoring the micro-finance loan book, especially considering the current industry scenario. He reassured that the asset quality of the entire loan portfolio remains stable, with gross non-performing assets (NPA) at 1.94% and net NPA at 0.52%, indicating a relatively healthy financial standing.
