Finace And Stock

Banks, NBFCs report jump in advances in September quarter

In a sign that bank credit growth may be on an uptrend, most bank and non-bank lenders reported a jump in disbursal of advances in the quarter ended September.

HDFC Bank saw its advances book grow by around 15.4% year on year at the end of the September quarter, proforma numbers released by the private sector lender showed. Its total loans aggregated to Rs 11.98 lakh crore at the end of September, up 4.4% sequentially. It’s total loans were at Rs 10.38 lakh crore at the end of September 2020.

As per the bank’s internal business classification, retail loans during the September quarter grew by around 13% year on year and 5.5% over June quarter. Commercial and rural banking loans grew by around 27.5% y-o-y while other wholesale loans grew by around 6%.

HDFC Bank has “resumed its retail growth journey” as the economy recovered from the second wave of Covid-19, said Gautam Chhuggani, director – financial at investment management firm Bernstein Research.

“We expect loan mix normalisation to be the norm in the coming quarters, with a focus on improving margins and ongoing tech transformation,” he said and noted that the bank has already reported a healthy bounce-back on new credit card issuances after the Reserve Bank of India in August lifted a ban imposed in December last year.

Mortgage lender HDFC assigned loans amounting to Rs 7,132 crore at the end of the September quarter versus Rs 3,026 crore a year earlier. It sold loans worth Rs 27,199 crore in the preceding 12 months versus Rs 14,138 crore in the previous year, regulatory filings show.

Private sector lender IndusInd Bank reported better-than-expected credit growth of 10% with total loans at Rs 2.2 lakh crore at the end of the September quarter, preliminary numbers filed with stock exchanges showed.

“The credit growth indicates underlying strong credit re-acceleration in the retail book,” said Anand Dama, senior research analyst at Emkay Financial Services. “The bank has been growing its corporate book since the June quarter and we believe that the bank is likely to have seen healthy momentum in the corporate book in September quarter as well.”

IDFC First Bank posted 9.75% growth in advances at Rs 1,17,243 crore for the second quarter ended September.

Leading non-bank lender Bajaj Finance reported it had booked 6.3 million new loans at the end of the September quarter versus 3.6 million a year ago. It’s assets under management (AUM) stood at Rs 1.66 lakh crore for the quarter under review as against Rs 1.37 lakh crore a year earlier.

Non-bank lender Mahindra & Mahindra Financial Services posted a 60% year-on-year growth in disbursements at Rs 6,450 crore at the end of the September quarter. With further improvement in mobility during September, the collection efficiency for the NBFC was reported at 100% for September 2021.

“Subject to improvement in auto supply chain, the company is hopeful of a good Q3 FY22 ahead, supported by festival season and harvest cash flow.” M&M Finance said in a statement.

Private lender Yes Bank posted a 3.6% rise in its advances to Rs 1.72 lakh crore, though retail disbursements grew at a faster rate and grew by 126.6% over last year to Rs 8531 crore at the end of the September quarter as against Rs 3764 crore a year ago.

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