Bandhan Bank shares slip after loan book, deposits fall in Q1; global brokerage retains ‘underperform’ call
Bank Bandhan’s share price spilled more than 2 percent in the morning session on July 16, a day after a personal lender said the loan book and deposit decreased in the June quarter.
In a business update to the stock market, the Kolkata-based Bank on July 15 said the loan and the progress shrank by 8 percent in the June quarter to Rs 80,128 Crore from Rs 87,043 Crore in the March quarter. The total deposits were contracted by the QoQ Persenten to Rs 77,336 Crore from Rs 77,972 Crore, said the bank.
However, based on year to year (yoy), loans and deposits each grew 8 percent and 28 percent respectively.
In deposits, CASA (currently, deposits of savings account) shrank 2 percent on the basis of QoQ but shows a growth of 48 percent on the base of YoY.
Retail deposits, however, show strong growth in this quarter, grow 4 percent on the basis of QOQ and 36 percent based on YoY. Bulk deposits (larger deposits), however, shrank by 19 percent in sequence and by percent based on YoY.
Stock traded at Rs 312.90, down RS 6.70, or 2.10 percent at 0935 hours. It has touched the highest intraday RS 316.05 and Low intraday Rs 307.25.
The retail ratio of total deposits increased to 83 percent in the June quarter compared to 79 percent in the previous quarter. The leap in the retail deposit section is seen as a healthy sign for the bank. The Casa ratio, however, decreased to 42.9 percent from 43.4 percent in sequence.
According to industrial officials, Bank Bandhan’s collection suffered because of the Covid situation and also partly because of the lower collections reported in Assam, where several provisions from the recent microfinance bills, along with loan neglecting calls with local politicians, have influenced credit discipline.
The CLSA global research firm has maintained a poorly performing call on shares with targets at Rs 300 per share. Brokerage companies believe that the first quarter update showed the efficiency of collection 72 percent in the microfinance business on a collection of 95 percent in March, the report said CNBC-TV18.
“The decline in the MFI collection has been high in the second covid wave. In West Bengal, it is too high even though political interference can be ignored,” he said.
