Sunday, February 18, 2024
Home News Bandhan Bank crashes to 3-year low on asset quality concerns

Bandhan Bank crashes to 3-year low on asset quality concerns

Bandhan Bank,

Bandhan Group, which has its headquarters in Kolkata, will gain immediate access to the top-10 by purchasing IDFC.

Portions of Bandhan Bank hit a three-year low of Rs 185.45 as they drooped 6% on the BSE in Tuesday’s exchange in the midst of resource quality worries. The private sector lender’s stock has fallen to its lowest point since April 2020. It had hit a record low of Rs 152.35 on Walk 25, 2020.

The bank’s December quarter (Q3FY23) net interest income (NII) decreased by 66.2% year-over-year (YoY) to Rs 290.6 crore, resulting in a 23% decline in the stock over the past two months. 2,080.4 crore, a decrease of 2.1% from the previous year.

According to the bank, an increase in the cost of funds and a higher reversal of interest income were the primary causes of the decline in NII. Compared to the previous quarter, which saw a net interest margin of 7%, the bank’s net interest margin for the current quarter was 6.5%. The bank wrote off loans totaling Rs 8,897 crore during the quarter for a total of Rs 801 crore, of which Rs 387 crore were issued as security receipts.

Based on the initial trends and growth reports, management predicted that the bank’s performance would improve significantly in the fourth quarter.

Analysts at KRChoksey Shares and Securities say that Bandhan’s Q3FY23 financial performance was poor because of slower overall business growth, an impact on NII earnings, and higher levels of provisions that hurt overall profitability. Due to lower growth in its Microfinance Institution (MFI) segment, credit growth was modest.

However, on the asset quality front, analysts continue to be cautious regarding the MFIs’ pool of stressed assets, resulting in higher credit costs. According to the brokerage firm, we have revised down our estimates for FY24E and added FY25E. We anticipate that NII will have a CAGR of 16.6%, PPoP of 8.8%, and PAT of 251.2%.

According to HDFC Securities analysts, we are cautious about any near-term consequences from the bank’s tighter pivot, despite management appearing confident about ongoing borrower behavior reforms that reflect a gradual alleviation of stress in its core Emerging Entrepreneur Business (EEB) portfolio.

first distributed: 28 March 2023, 11:00 a.m.

RELATED ARTICLES

Markets end FY23 in style; Sensex Nifty rally nearly 2% on firm global trends

Market, The final day of the fiscal year 2022-23 saw gains for benchmark indices, with a gain of nearly 2% on Friday, extending gains for...

Day trading guide for today: 6 stocks to buy or sell on Friday — 31st March

Trading, Day trading guide for today: Indian shares gained on Wednesday as global markets' increased risk appetite was aided by easing in the banking industry....

Financial, IT stocks aid Indian shares snap three-month losing streak

Financial, By Bharat Rajeshwaran BENGALURU (Reuters) - Indian shares rose on Friday, supported by a higher weighting of financial stocks and information technology (IT) stocks,...

LEAVE A REPLY

Please enter your comment!
Please enter your name here

SIGNUP & GET $10000 BONUS

Most Popular

Trading the Inside Bar Pattern on Pocket Option Platform

Inside Bar Pattern Introduction Price movement on a chart is examined in price action trading. You may use candlesticks to predict where prices will move...

“Unlocking the Secrets: 4 Tricks of Successful Traders on Pocket Option Platform”

For a year, I have been trading on the Pocket Option platform. I sometimes succeed and sometimes fail. However, I was confident that if...

Identifying Mistakes That Lead to Losses on Pocket Option

Why do people lose their money when trading binary options New traders frequently take a significant financial risk while trading binary options. As a result,...

Weekly Income Plan on Pocket Option Platform”

Get weekly returns on Pocket Option It turned out that October was a terrific month for me. I am still able to generate money every...

Recent Comments