RBL Bank Q3 Results Review - Stable Quarter; On Improving Trajectory: Nirmal Bang
RBL Bank’s earnings were largely in-line with our estimates with profit after tax growth of 33.9% YoY, led by NIM expansion
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Nirmal Bang Report
RBL Bank Ltd.’s earnings were largely in-line with our estimates with profit after tax growth of 33.9% YoY (3.7% QoQ), led by net interest margin expansion.
Credit growth momentum continued on a sequential basis, with 5.9% growth to Rs 666.8 billion while deposit growth was moderate at 2.9% QoQ (11% YoY) to Rs 817.5 billion.
Calculated net interest margin came in at 10 quarters’ high and expanded by 40 bps YoY (32 bps QoQ) to 4.6%, leading to NII growth of 13.6% YoY (7.9% QoQ) to Rs 11.5 billion (which was almost 5% higher than our estimate).
Other income registered a growth of 6% each YoY and QoQ to Rs 6.2 billion. Moreover, core fee income showed an uptick, increasing by 8% QoQ to Rs 5.8 billion. Operating expenditure continued to remain elevated, increasing by 25% YoY (6% QoQ) to Rs 12 billion as RBL Bank continued to invest in infrastructure and branch expansion. As a result, cost/income ratio increased by 67.9% versus 60.4% in Q3 FY22.
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