Bandhan Bank Advances Increase by 12.3%

Bandhan Bank has reported promising financial growth for the September quarter, showcasing a 12.8% increase in total deposits and a 12.3% rise in loans and advances during the period. The bank’s shares have recently surged following media reports of a new executive director joining from HDFC Bank.

Advances grew by 4.3% from the June quarter, reaching Rs 1,07,633 crore compared to Rs 95,835 crore the previous year. The bank also demonstrated solid deposit mobilization, with total deposits rising by 12.8% to Rs 1.12 lakh crore. Current Account Savings Account (CASA) deposits increased by 6.5% year-on-year to Rs 43,161 crore, while retail deposits, including CASA, experienced a 12.6% yearly growth to Rs 82,977 crore.

The bank’s total bulk deposits stood at Rs 29,098 crore, reflecting a year-on-year increase of 13.2%. However, this figure is lower than the previous quarter’s Rs 31,240 crore but higher than last year’s Rs 25,705 crore.

Despite these positive indicators, the bank’s revenue growth has been slowing, and it faces challenges with weak gross profit margins. Notably, Bandhan Bank is quickly depleting its cash reserves, raising concerns regarding the quality of its earnings, as free cash flow is trailing net income.

On a positive note, Bandhan Bank maintained strong loan collection efficiency at 98%, with a liquidity coverage ratio (LCR) of 162.90% as of September 30, 2023. Analysts suggest that while the CASA ratio has dipped slightly to 38.5%, the overall financial performance remains robust, characterized by steady advances growth and effective loan collection.

This article has been generated with the support of AI and reviewed by an editor.