Axis Bank Q1 profit misses estimates as bad loan provisions surge
Bengaluru: Axis Bank on Thursday reported a lower-than-expected net profit for the first quarter, as increased provisions for potential bad loans and worsening asset quality weighed on its earnings, according to a Reuters report.
The private-sector lender posted a standalone net profit of ₹5,806 crore ($674.8 million) for the quarter ended June 30, down from ₹6,035 crore in the same period last year.
Analysts had projected a profit of ₹6,373 crore, based on LSEG data.
Net interest income — the spread between interest earned and interest paid — inched up 0.8% to ₹13,560 crore, as per Reuters' calculations.
Provisions and contingencies surged twofold year-on-year to ₹3,948 crore, as Indian banks continue to battle stress in microfinance and unsecured loan segments, prompting them to bolster reserves and shore up their balance sheets.
Axis Bank's gross non-performing asset (GNPA) ratio rose to 1.57% as of June-end, from 1.28% in the previous quarter, signalling a deterioration in asset quality.
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