Yes Bank Q2 Profit Rises 65% to Rs 1,080 Crore; AT-1 Impact Pending
Yes Bank on Saturday reported a standalone net profit of Rs 1,080 crore for the July–September quarter, up 65% from Rs 654 crore a year earlier. The private lender said the results do not yet account for the Supreme Court’s October 15 ruling on its Rs 8,415 crore Additional Tier-1 (AT-1) bonds.
Key Numbers From the Quarter
Net interest income, the gap between interest earned and paid, rose 22.7% to Rs 2,822 crore. Provisions fell 24.2% to Rs 317 crore, and profit before tax rose 55% to Rs 1,360 crore. For the first half of the financial year, profit stood at Rs 2,151 crore.
Advances grew 23.7% to Rs 3.10 lakh crore and deposits rose 19.5% to Rs 3.54 lakh crore. The gross bad loan ratio eased to 1.2% from 1.6% a year ago, and the net bad loan ratio stood at 0.2%.
The AT-1 Bond Question
The Supreme Court this week upheld a Bombay High Court judgment and dismissed appeals over the March 2020 write-off of the AT-1 bonds. The bank said it “is evaluating the consequential implications and the legal remedies available”, and has recognised no financial impact so far. Its joint statutory auditors issued a qualified review conclusion on this point.
The bank disclosed that, had the impact been recognised, it would have reported a net loss of Rs 5,217 crore for the quarter and its net worth would have fallen to Rs 46,970 crore from Rs 53,268 crore. Its capital adequacy ratio would have stayed at 14.5%, according to the disclosure.
Why It Matters for Depositors and Investors
For depositors, the capital adequacy ratio is the key safety measure, and the bank says it would remain well above the regulatory minimum even after the AT-1 impact. Steady deposit growth and lower bad loans also point to a lender in more stable shape than during its 2020 rescue.
For the thousands of retail investors who held the written-off bonds, the next steps the bank takes on repayment will be closely watched, as will the market’s response when trading resumes on Monday.
The results follow strong September-quarter numbers from HDFC Bank and ICICI Bank. Read our earlier report on the Supreme Court’s AT-1 bond ruling.
Based on reporting by Business Standard and Upstox News.
Image: Business Standard (file).
