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CGFMU forensic audit outcome
View Risks →Bandhan Bank Limited — Q3 FY24
Bandhan Bank reported a strong Q3 FY24 with PAT surging 152% YoY to INR 733 crore, driven by robust loan growth and stable asset quality.
bullish
medium
Financial stats pending filing verification
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Bandhan Bank reported a strong Q3 FY24 with PAT surging 152% YoY to INR 733 crore, driven by robust loan growth and stable asset quality. Advances grew 18.6% YoY to INR 116,000 crore, with secured assets reaching 44.5% of the portfolio. NIM held steady at 7.2% despite cost pressures. The bank completed a core banking system migration, which caused a temporary spike in slippages in October, but monthly run-rate normalized by December. Management expects continued growth momentum in Q4 and guided for ROA of 2.5%-2.8% and ROE of 14%-18% over the medium term. Key risks include the ongoing CGFMU forensic audit and potential margin compression as the mix shifts toward secured assets.
बंधन बैंक ने तीसरी तिमाही में शानदार प्रदर्शन किया। इसका मुनाफा पिछले साल की तुलना में 152% बढ़कर 733 करोड़ रुपये हो गया। इसकी वजह ज्यादा लोन देना और कम खराब कर्ज रहना है। बैंक ने 18.6% ज्यादा कर्ज बांटे, जो 1,16,000 करोड़ रुपये तक पहुंच गया। अब 44.5% कर्ज सुरक्षित (जैसे घर या गाड़ी पर लोन) है। बैंक की ब्याज कमाई दर 7.2% पर स्थिर रही। अक्टूबर में नए कंप्यूटर सिस्टम लगने से कुछ कर्ज डिफॉल्ट हुए, लेकिन दिसंबर तक सब सामान्य हो गया। आगे बैंक को अच्छी बढ़त की उम्मीद है। वह 2.5-2.8% संपत्ति पर रिटर्न और 14-18% इक्विटी पर रिटर्न चाहता है। लेकिन सीजीएफएमयू की जांच और सुरक्षित कर्ज बढ़ने से मुनाफा कम होने का खतरा है।
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Read Transcript →Quarter Snapshot
Gross NPA Ratio
7.0%
-30bps QoQ
Improved from 7.3% in Q2 FY24, reflecting better asset quality.
Net NPA Ratio
2.2%
-10bps QoQ
Down from 2.3% in Q2 FY24, indicating lower stress.
CASA Ratio
36.1%
+14% YoY
CASA deposits grew 14% YoY despite tight liquidity.
EEB Portfolio NPA (FY24 Book)
0.11%
-0.39pp YoY
New disbursements show strong quality, down from 0.5% last year.
What Changed vs Last Quarter
NEW
Secured assets to reach ~50% by FY26
Management expects secured portfolio share to increase from current 44.5% to nearly 50% by FY26.
NEW
NIM to remain in 7%-7.5% range near-term
Management guided NIM to stay around 7%-7.5% in the near term, with a strategic review in March.
NEW
ROA target of 2.5%-2.8% and ROE of 14%-18%
Medium-term guidance for ROA and ROE, with detailed three-year plan to be shared after February strategy meet.
DROPPED
Loan growth of ~20% YoY for FY24
Management expects overall advances to grow nearly 20% year-on-year, driven by festive demand and strong disbursements in H2.
DROPPED
Credit cost guidance of 2% ±20bps for FY24
The bank expects credit cost to remain in the range of 1.8% to 2.2% for the full year, supported by lower slippages and higher recoveries in H2.
DROPPED
OpEx to assets ratio of 3.5% for FY24
Management guided for operating expenses to assets ratio of 3.5% for FY24, with balance sheet growth in H2 absorbing costs.
DROPPED
Secured loan share target of 50% by FY26
The bank aims to increase the share of secured assets to 50% of total advances by fiscal year 2026, up from 44% currently.
NEW RISK
CGFMU forensic audit outcome
NCGTC is conducting a detailed forensic audit on CGFMU claims; adverse findings could impact recoveries and provisions.
NEW RISK
Margin compression from secured asset shift
As the bank increases secured asset share, yields may decline, potentially pressuring NIMs despite cost controls.
NEW RISK
Slippage run-rate uncertainty
Management expects INR 300-500 crore quarterly slippage addition, but this may vary if collection efficiency weakens.
RISK GONE
Elevated slippages from EEB book
Despite DPD reduction, gross slippages remained high at INR 1,320 crore, with EEB contributing INR 1,000 crore. Management expects H2 improvement but past trends show elevated slippages in H2 as well.
RISK GONE
Delay in CGFMU and ECLGS recoveries
CGFMU recovery of ~INR 1,600 crore delayed due to audit queries; ECLGS recovery of INR 410 crore pending due to operational constraints. Management could not provide a timeline.
RISK GONE
NIM compression from rising cost of funds
Cost of funds expected to rise 20-25 bps in coming quarters due to savings rate hike and term deposit repricing, which could pressure NIMs despite higher yields.
RISK GONE
Slow growth in housing loan book
Housing finance book grew only ~4% YoY, lagging other segments. While disbursement run-rate has improved, sustained growth remains uncertain.
🤫 Topics management stopped discussing
Mentioned in Q1 FY24, Q2 FY24
Despite DPD reduction, gross slippages remained high at INR 1,320 crore, with EEB contributing INR 1,000 crore. Management expects H2 improvement but past trends show elevated slippages in H2 as well.
Mentioned in Q1 FY24, Q2 FY24
Management expects overall advances to grow nearly 20% year-on-year, driven by festive demand and strong disbursements in H2.
Fast read
Guidance and risk preview
Management expects secured portfolio share to increase from current 44.5% to nearly 50% by FY26.
NCGTC is conducting a detailed forensic audit on CGFMU claims; adverse findings could impact recoveries and provisions.
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