Federal Bank Q3 result

CHENNAI: Federal Bank announced the Financial Results for the quarter ended 31^st December 2024. The key highlights of the results are as follows:

The Bank has delivered its highest-ever operating profit, achieving a remarkable ₹1,569.46 crore. The Bank’s sustained focus on growth and operational excellence has also led to an impressive financial trajectory, highlighted by the following key metrics:

• Operating Profit: Highest ever at ₹1,569.46 crore.
• Net Interest Income: At an all-time high of ₹2,431.34 crore, reflecting a 14.50% YoY growth.
• Fee Income: Witnessed a strong 21% YoY growth.

The Bank has achieved its best asset quality performance in over a decade, reflecting its robust risk management framework and commitment to financial prudence. Key highlights are:

• Gross Non-Performing Assets: Reduced to 1.95%.
• Net Non-Performing Assets: Declined to 0.49%.
• Provision Coverage Ratio: Strengthened to 74.21%.

The Bank continues to demonstrate strong business momentum, with substantial year-on-year growth across deposits, advances, and key product categories. Highlights of the Bank’s performance include:

• Total Deposits: Increased by 11% YoY, reflecting strong customer trust and engagement.
• Total Net Advances: Achieved a growth of 16% YoY, driven by focused lending strategies.
• Average CASA: Grew by 11% YoY, underlining the strength of the Bank’s core business engine
• NRE Deposits: Registered a solid 10% YoY growth, showcasing the Bank’s popularity among non-resident customers.
• Credit Cards: Expanded by 24% YoY, reflecting enhanced customer adoption.
• Commercial Vehicle/Construction Equipment (CV/CE) and Micro Advances: Delivered robust growth of 39% and 50% YoY, respectively.

Management Commentary

Mr. KVS Manian, MD & CEO stated “This quarter has been pivotal for us as we strategically reoriented both the asset and liability sides of our balance sheet, addressing fundamental aspects to position the Bank strongly for the future. We have chosen to focus on granular retail deposit growth instead of high value, expensive deposits. We have also consciously avoided low yielding or high-risk assets for the sake of growth. Notwithstanding this disciplined approach, we have achieved a year-on-year growth of 15% in advances and 11% in deposits, positioning us competitively within the sector. We achieved this with minimal disruption. Our asset quality has reached its strongest levels in a decade. In alignment with our commitment to building a robust foundation, we have undertaken accelerated provisioning for certain riskier asset classes this quarter. We remain steadfast in our focus on building a high-quality franchise that delivers value to all stakeholders whether through superior customer service and relationships, an enhanced employee proposition, or consistent and sustainable earnings quality. As we look ahead, we are optimistic about future opportunities and confident in our ability to create enduring value for all our stakeholders.”

WORKING RESULTS AT A GLANCE

 Strong Growth and Resilient Balance Sheet Performance

The Bank continues to demonstrate strong growth and resilience, with the total business of the Bank reaching ₹4,96,744.97 crore as of 31st December 2024, reflecting a robust year-on-year growth of 13.21%.

• Deposits: Total deposits increased from ₹2,39,591.16 crore as of 31st December 2023 to ₹2,66,375.43 crore as of 31st December 2024.
• Advances: On the asset side, net advances grew from ₹1,99,185.23 crore as of 31st December 2023 to ₹2,30,369.54 crore as of 31st December 2024. Key segments contributing to this growth include:
  • Retail Advances: Up by 13.00%, reaching ₹73,498.54 crore.
  • Business Banking Advances: Increased by 13.21% to ₹18,923.18 crore.
  • Commercial Banking: Registered a substantial growth of 24.76%, reaching ₹25,880.00 crore.
  • Corporate Advances: Achieved a 7.62% growth, totalling ₹77,464.94 crore.
  • Commercial Vehicle/Construction Equipment Advances: Recorded outstanding growth of 38.53%, reaching ₹4,235.00 crore.