- 29 Oct 2024
- ICICI Securities
FEDERAL BANK REPORTED SOLID Q2FY25 RESULTS, WHEREIN NET ADVANCES ROSE
News: Federal Bank reported solid Q2FY25 results, wherein net advances rose 19.5% YoY (4% QoQ) to ₹2,30,312 crore, led by 17% YoY rise in retail book and 24% YoY increase in commercial banking while corporate segment grew at 10.5% YoY. Deposit accretion came at 16% YoY (1% QoQ) to ₹2,69,107 crore with focus on CASA growth of 11% YoY with CASA ratio improving 80 bps QoQ to 30.07%. NII grew at 15% YoY, while NIM saw marginal contraction of 4 bps QoQ to 3.12% (impact die to change in accounting of penal charges). Healthy NII, fee & other income partially offset by higher provision led to 10.8% YoY growth in earnings to ₹1,057 crore, with RoA stable at 1.28%. Slippages ratio was steady at 0.76% and GNPA/NNPA ratios improved 2 bps/3 bps QoQ to 2.11%/0.57% respectively.
Views: Growth momentum maintained with focus on deposit mobilization by enhancing CASA mix in both retail and wholesale segments. Relatively stable asset quality trend with impact of current MFI environment weathered due to select exposure in specific geographies.
Impact: Positive