Bandhan Bank Q4 Results, Net Profit Plunges By 94%

Bandhan Bank’s Q4FY24 results were announced today and it showcased a significant decline in net profit due to substantial loan write-offs, despite an improvement in net interest income (NII). The bank reported a net profit of Rs.55 crore, marking a steep 94% drop from Rs.876 crore in the same quarter of the previous year. This decline is attributed primarily to increased provisions and write-offs aimed at addressing bad loans.

Earnings Breakdown

Bandhan Bank’s Q4FY24 results showed notable financial results, NII grew 15.63% y-o-y, reaching Rs.5,189 crore from Rs.4,488 crore, reflecting strong interest earnings and good expense management. Further, the bank reported a drop of 94% in net profit to Rs.55 crore, compared to Rs.876 crore last year however, provisions and write-offs surged 38.42% to Rs.1,753 crore from Rs.1,266 crore in Q4FY23, necessary to cover high-risk bad loans, directly impacting net profit. 

Despite this, the bank improved its asset quality, with the GNPA ratio decreasing to 6.49% from 7.25% and the Net NPA ratio slightly reducing to 1.85% from 1.92%. Additionally, Bandhan Bank declared a dividend of Rs.1.50 per share, demonstrating a commitment to returning value to shareholders amid challenging financial conditions.

Financial Highlights

Leadership Transition at Bandhan Bank

Bandhan Bank will undergo a significant leadership change as Managing Director and Chief Executive Chandra Shekhar Ghosh announced his retirement, effective July 9, after nearly ten years in his role.

Conclusion: Bandhan Bank’s Q4FY24 performance underscores the dual challenge of managing high provisions and maintaining profitability. While the significant drop in net profit highlights the impact of provisioning, the rise in NII and improvement in asset quality present a more balanced view of the bank’s overall health. As the bank continues to navigate through this, its focus on strengthening the balance sheet and improving asset quality will be crucial for future growth.

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