AU Small Finance Bank on Thursday said its net profit in September quarter of the current fiscal year rose by 14 percent to Rs 196 crore. The company had reported a net profit of Rs 172 crore for the corresponding quarter of 2019-20.

AU Small Finance Bank said the net profit in the quarter is excluding the profit on sale of equity stake in Aavas Financier. The income from the sale of equity in Aavas was Rs 144 crore.

Total income during July-September 2020-21 jumped 40 percent to Rs 846 crore as against Rs 602 crore in the same quarter of 2019-20, it said in a release. "The on-ground situation has considerably improved in Q2FY21 and we saw positive momentum across all key metrices which include our Digital Banking journey, activity levels, collection efficiencies, retail deposits, and disbursements.

"Various pro-active initiatives taken by the government and RBI have helped mitigate the pandemic impact on borrowers. Further, AU Bank remains actively engaged to help affected customers," MD & CEO Sanjay Agarwal said.

The lender said it has adequate liquidity cushion with liquidity coverage ratio at about 140 percent at the end of September 2020, higher than the regulatory requirement of 80 percent.

The bank had maintained excess liquidity during the quarter which had an impact of 18-20 basis points on net interest margin (NIM), it said. "With uptick in business momentum and easing of operating environment, the bank has been focusing on reducing the excess liquidity buffers; Going forward we will maintain optimum liquidity levels basis market conditions and overall environment," the bank said.

The lender brought down its gross non-performing assets (NPAs) to 1.5 percent of gross loans as of September 30, 2020 against 2 percent by September 2019. Net NPAs also fell to 0.5 percent from 1.1 percent.

Total assets rose 23 percent to Rs 44,014 crore at the end of September quarter 2020-21. Deposits increased by 22 percent to Rs 26,980 crore and advances were up by 10 percent to Rs 27,233 crore.

The bank carries Rs 278 crore of COVID-19 related provisions which constitute about 1 percent of gross advances. "Based on activity levels of complete moratorium cases and collection feedback, we have not made any further COVID-19 related provisions," it added.

First Published:Oct 30, 2020 12:17 PM IST