Federal Bank announces decline in profit by 8% in Q3

Federal Bank reported an 8% fall in their Q3 net profit at Rs 404 crore in comparison to Rs 441 crore in the previous year quarter period.

The bottom line was weighed down by 161% year-on-year (YoY) increase in provisions (other than tax) and contingencies at Rs 421 (Rs 161 in the year-ago period).


Gross non-performing assets (NPAs) declined to 2.71% of gross advances in Q3 FY20 against 2.84% in the preceding quarter, Q3 FY21.

Net NPA position improved to 0.60% of net advances against 0.99% in the preceding quarter.

In absolute monetary terms, gross NPAs stayed at Rs 3.470.18 crore compared to Rs 3,618.69 crore in the previous year.

The bank based in Kerala has announced an income of Rs 3,941.36 crore in Q3 that commenced in December 2020 as against Rs 3,738.22 crore in the year-ago period, noting a YoY growth of 5.43%.

On the consolidated base, Federal Bank’s profit had reduced by 7.41% YoY at Rs 418.14 crore. On the other hand, revenue grew by 6.63% YoY to Rs 4,088.77.

Net interest income was up 24% YoY to Rs 1,437 crore (Rs 1,155 crore). Other income increased by 18% to Rs 482 crore (Rs 408 crore).

Operating profit stood at Rs 962.90 crore versus Rs 743.82 crore in the same period, the previous year.

The impact of COVID-19 has left the entire economy to suffer and recover. The lending bank said it will depend on several aspects which include actions taken to manage the impact and other regulatory measures. Federal Bank’s capital and liquidity position is strong and will continue to be the primary domain of focus during this period.

As the RBI has mandated new provisions due to COVID-19, the bank made a provision of Rs 587.91 crore during the quarter ended 30th September 2020. In the current quarter, the bank has used Rs 51.22 crore from the mentioned provision to create RBI mandated provisions for advances updated under “Resolution framework for COVID-19 related stress”. Therefore, the aggregate provision against the expected impact of Coronavirus, containing the RBI mandated provision was 536.69 crore as on 31st December 2020.

After the Q3 results, shares of Federal Bank were trading at Rs 75.20, down 0.27%, in comparison to the previous closing price of Rs 75.40 on the BSE.