Private banks report mixed results as new CEOs clean up

Mumbai: India's showed contrasting trends in in , with larger lenders maintaining stability while smaller players, particularly those under new leadership, reported setbacks in earnings. IndusInd Bank and Federal Bank, both navigating transitions under new MDs, did not post year-on-year growth in net profits as the chiefs accelerated clean-ups and strengthened governance.

HDFC Bank, the country's largest private lender, reported a 10.8% rise in net profit to Rs 18,640 crore, driven by a 25% jump in non-interest income and steady improvement in asset quality. MD and CEO Sashidhar Jagdishan said economic activity was improving across customer and product segments, allowing the bank to accelerate loan growth. Asset quality remained a key strength, with the bank maintaining stable ratios for net interest margin, cost-to-income, and return on assets. HDFC Bank also continued its investments in technology and innovation, including GenAI and "lighthouse experiments", aimed at improving efficiency and customer experience over the next 18-24 months.

ICICI Bank's net profit grew 5.2% to Rs 12,359 crore despite a steep drop in treasury income. Excluding treasury, core operating profit rose 6.5%, reflecting steady underlying performance. Provisions fell 25.9%, helping gross NPAs ease to 1.58% and net NPAs to 0.39%. The lender expanded retail and business banking loans, which now account for more than half its portfolio.

IndusInd Bank, under new MD and CEO Rajiv Anand, recorded a net loss of Rs 437 crore as the bank accelerated write-offs and increased provisions in microfinance to strengthen its balance sheet. The lender also continued to contend with legacy issues stemming from prior accounting irregularities. Gross NPAs improved slightly to 3.60%, while net NPAs eased to 1.04% but deposits and advances contracted, and core income fell.

YES Bank reported an 18.3% rise in net profit to Rs 654 crore, supported by higher non-interest income, cost efficiency, and retail growth. Net NPAs declined to 0.3% while gross NPAs remained stable at 1.6%. The quarter marked a strategic ownership change, with Sumitomo Mitsui Banking Corporation acquiring a 24.2% stake, and the bank continued to expand its branch network and digital footprint. MD and CEO Prashant Kumar emphasised the business model and strategy remained unchanged, with efforts ongoing to improve revenues, net interest margin, and cost-to-income ratio.

Federal Bank posted a 9.5% decline in net profit to Rs 955 crore due to higher provisions, even as gross NPAs fell to 1.83% and net NPAs to 0.48%. Under new MD and CEO KVS Manian, the bank focused on strengthening risk management, increasing mid-yield assets, and expanding digital transactions, which now account for over 92% of all retail and corporate activity.

PNB net profit jumps 14% to ₹4904 crore

Punjab National Bank reported a 14% rise in Q2 net profit to Rs 4,904 crore, with operating profit up 5.5% to Rs 7,227 crore. Total income grew 5.1%, while net interest income slipped 0.5%. Gross and net NPAs fell to 3.45% and 0.36%, respectively. Advances and deposits rose 10.1% and 10.9%. Retail, agriculture, and MSME loans drove growth. CRAR strengthened to 17.19%, digital transactions surged 31%, and full-year credit growth is expected at 11%-12%.