HDFC Bank Q4 net up 30 per cent
Our Banking Bureau
14 April 2005

Mumbai: HDFC Bank has registered a 30.8 per cent increase in its net profit at Rs202.4 crore for the fourth quarter ended March 31, 2005, against Rs154.7 crore in the corresponding quarter last year.

An increase in credit and income from fees and commission drove profits up, said Paresh Sukhatankar, Head, Credit and Risk, HDFC Bank.

The bank has recommended a dividend of 45 per cent, (Rs4.5 per share) which includes a special one-time dividend of 5 per cent on the occasion of the bank completing 10 years.

Total income rose to Rs1,087.27 crore (Rs806.31 crore). Net interest income was at Rs513.6 crore (Rs360.57 crore), driven by balance sheet growth, a marginal improvement in spreads and profit on sale of retail loans.

Other income that includes commission and sale of investments grew by 56.6 per cent to Rs220.1 crore (Rs140.5 crore).

Total expenditure for the quarter increased to Rs682.33 crore (Rs521.97 crore).Net profit for the full year rose by 30.6 per cent to Rs665.6 crore (Rs509.5 crore).

Total income stood at Rs3,744.83 crore (Rs3,028.96 crore). Net interest income increased to Rs1,777.93 crore from Rs1,337.88 crore.

The bank reported a loss of Rs81.06 crore in its treasury operations against a profit of Rs148.49 crore last year. This is due to the rise in interest rates, said Sukhatankar. "We were never dependent on treasury income. Our income come from fees and commissions have offset the losses from treasury income," he added.

About the outlook on interest rates, Sukhatankar said, "I expect interest rates to go up in the next three to six months as government borrowings will happen in the first half of the year. The rising oil prices too will push up interest rates. Due to this, interest rates on both loans and deposits are likely to rise." But the extent of the interest rate's upward movement will depend on inflation and the amount of government borrowing, he added.

For the year, total deposits were at Rs36,354 crore. Savings account deposits increased to Rs 1,1418 crore from Rs.7804 crore.

Net advances grew by 44 per cent to Rs.25,566 crore. This was driven by a growth of 47.5 per cent in retail advances to Rs11,696 crore and an increase of 41.3 per cent in wholesale advances to Rs13,870 crore.

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