Last updated: Oct 5, 2023 11:42 IST
Bandhan Bank Loans and Advances
Private lender Bandhan Bank said in a business update on Wednesday that total deposits grew by 12.8 percent
Bandhan Bank Shares: Private lender Bandhan Bank said in a business update on Wednesday that total deposits grew 12.8 percent in the September quarter, while loans and advances rose 12.3 percent in the same period. In a filing with BSE after trading hours on Wednesday, the bank said its deposits rose to Rs 1,12,074 crore at the end of September, against Rs 99,366 crore in the same quarter last year. Deposits rose 3.3 per cent from Rs 1,08,480 crore in June, the bank told BSE.
Of particular note is the growth in current account savings accounts (CASA), which rose 10.5 percent quarter-on-quarter and 6.5 percent year-on-year to reach Rs 43,161 crore.
Further, Bandhan Bank reported a 7.4 percent quarter-on-quarter increase and 12.6 percent year-on-year growth in retail deposits, totaling Rs 82,977 crore.
In contrast, bulk deposits showed a decline of 6.9 per cent on a quarter-on-quarter basis but still showed a substantial growth of 13.2 per cent on a year-on-year basis, amounting to Rs 29,098 crore.
A notable metric to highlight is the CASA ratio, which stands at 38.5 percent. This represents an increase from the previous quarter’s 36 percent and a slight decrease from the year-over-year ratio of 40.8 percent.
In its second quarter outlook, Nuvama Institutional Equities said that despite weak earnings in the June quarter, Bandhan Bank shares rose 17 percent on media reports that the new ED joining Bandhan Bank , will come from HDFC Bank.
“Bandhan is likely to get a new emergency room soon. It is very likely that it will come from a large private bank. However, the purpose of another ED is to strengthen the management team. Therefore, it is unlikely to be a management transformation story like MMFS,” Nuvama said while suggesting a ‘Hold’ on the stock.
“Bandhan gave a strong update with loans growing 4 percent quarter-on-quarter and deposits 3 percent,” it said, while expecting second-quarter NIM to decline by 12 basis points quarter-on-quarter.
“Opex will rise with higher spending in the quarter despite weak credit growth. Depreciation determines the level of credit costs. We assume flat QoQ credit costs. Skidding to stay high. Ex-ECLGS, the slippage in Q1FY24 was Rs 1,300 crore. We think it will remain at this level in the second quarter of 2020,” the broker said.
Nomura India said that while recoveries of non-performing loans (NPLs) from CGFMU (credit guarantee scheme for microfinance) were expected in the second quarter, there was no update from the bank in this regard. “We believe that procedural delays could now push this recovery into the third quarter (versus the second quarter as previously expected). We are waiting for clarity from management on this,” the brokerage said.
Brokerage firm Geojit Financial is bullish on Bandhan Bank and has recommended a buy rating on the stock with a target price of Rs 269 in its research report dated August 21, 2023.
Bandhan Bank shares have returned 22.52 percent in the last six months. The benchmark Nifty Bank index has returned 7.23 percent over the same duration.
Shares of Bandhan Bank ended at Rs 253.90, down by Rs 0.050, or 0.020 percent, on the BSE.
