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IDFC First Bank suffers Rs 1,538 crore loss in Dec quarter

Vaidyanathan said the bank aspires for a 5.5 per cent NIM led by high-yielding retail loans.

ET Bureau|
Updated: Feb 06, 2019, 08.43 AM IST
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Total income of IDFC First Bank, previously IDFC Bank, rose to Rs 3,968.40 crore in December quarter.
Mumbai: The newly-christened IDFC First Bank swung to a loss Rs 1,538 crore in the quarter ended December due to goodwill charge of Rs 2,599 crore as exceptional expenses, as a result of the erstwhile IDFC Bank’s acquisition by Capital First.

The bank took the one-time amortisation hit as banks are restricted from declaring a dividend if it carries an intangible asset like goodwill on its balance sheet. Without considering the exceptional item, the bank made a net profit of ₹153 crore.

CEO V Vaidyanathan said that the bank’s retail loan book has increased to 35 per cent of total loans in the quarter from 11 per cent before the merger in September. “Our aim is to build a retail book to about 70 per cent of the bank’s total loans in the next five years,” Vaidyanathan said.

The merger also resulted in the bank’s net interest margin (NIM) improving to 3.27 per cent from 1.70 per cent before the merger. Vaidyanathan said the bank aspires for a 5.5 per cent NIM led by high-yielding retail loans.

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