The Board of Directors of IDFC FIRST Bank, in its meeting held today, approved the unaudited financial results for the quarter and half year ended September 30, 2024.
Deposits and borrowings
Customer deposits grew by 32.4% to 30 billion rupees year-on-year. 164,726 crore as of September 30, 2023. 2,180.26 billion yen as of September 30, 2024.
Retail deposits grew 37.4% year-on-year from Rs. 1,27,595 billion as of September 30, 2023 and 1,75,300 million yen as of September 30, 2024.
CASA deposits grew 37.5% YoY to Rs 20 million. 79,468 crore as of September 30, 2023. 109,292 million as of September 30, 2024.
The CASA ratio is 48.9% as of September 30, 2024.
As of September 30, 2024, retail deposits accounted for 80.4% of total customer deposits.
The Bank’s cost of funds for the second quarter of 2025 was 6.46%, a slight improvement from the previous quarter. Excluding high-cost conventional borrowings, cost of funds was 6.37% in the second quarter of 2025.
Payment/fee business
The total number of credit cards issued last quarter exceeded 3 million. As the business grows, the cost-to-income ratio of the credit card business continues to improve, reaching 99.8% in the second quarter of 2025 compared to 104.1% in the first quarter of 2025.
Overall, the Bank’s wealth management assets under management exceeded Rs 100 crore. 2,000 billion yen in the second quarter of 2025.
In the FASTag business, the Bank continues to be the largest issuer bank with 20 million FASTAgs issued.
loans and prepayments
Loans and advances (including credit substitutes) increased by 21.5% YoY from Rs. 183,236 million as of September 30, 2023. 222,613 million as of September 30, 2024.
During the quarter, the bank’s personal loans grew by 25% year-on-year, while its corporate (non-infrastructure) loans grew by 20.0% year-on-year.
The bank’s traditional infrastructure book declined 21% year-on-year to Rs 20 billion. As of September 30, 2024, it is 265.4 billion yen, equivalent to 1.2% of the Bank’s total funding assets.
asset quality
Gross NPAs were 1.92% as on September 30, 2024 as against 2.11% as on September 30, 2023.
Net NPAs were 0.48% as of September 30, 2024 as against 0.68% as of September 30, 2023.
Gross NPAs for retail, rural and MSME finance stood at 1.57% as on September 30, 2024, compared to 1.53% as on September 30, 2023.
Net NPAs in retail, rural and MSME finance stood at 0.52% as on September 30, 2023 and 0.53% as on September 30, 2024.
Excluding the Bank’s depleted infrastructure lending book, the Bank’s GNPA and NNPA should be 1.66% and 0.47%, respectively, as of September 30, 2024.
The Bank’s PCR ratio increased to 75.27% as of September 30, 2024 from 68.18% as of September 30, 2023 and 69.38% as of June 30, 2024.
Collection efficiency:
The initial bucket collection efficiency in the retail book excluding MFI is stable at 99.5%.
According to the microfinance book, collection efficiency has declined from 99.0% in Q1 FY25 to 98.6% in Q2 FY25.
SMA location:
SMA-1+2 for retail, rural, and MSME finance portfolio excluding microfinance book improved from 0.95% as of June 30, 2024 to 0.87% as of September 30, 2024 on a quarter-over-quarter basis did.
The SMA-1+2 ratio in the microfinance business was 2.5% as of September 30, 2024, up from 1.7% as of June 30, 2024.
Microfinance businesses are being insured by CGFMU in a phased manner, with portfolio coverage increasing from 0% to 50% in 9 months, with the potential to increase to 75% by March 2025 .
Regulations:
Provisions for Q2FY25 were Rs 20,000 crore. 1,732 billion, primarily on account of prudent provision buffer of Rs 1,732 billion. $568 million was created
MFI Business (Rs. 315 cr). Covers approximately 99% of the SMA-1+2 portfolio. As of September 2024, this business segment represents 2.5% of the total portfolio.
One traditional paid account (Rs. 253 cr). Recognizing the impact on infrastructure lessees of the state government’s withdrawal of LMV tolls). It can be added to the bank’s profit if the fee is collected or if the government compensates the customer.
Without the MFI business and fee accounts mentioned above, credit costs in Q2 2025 would be ~1.8%.
profitability
Net interest income (NII) increased by 21% YoY from Rs. 3.95 billion in the second quarter of FY24. 478.8 billion in the second quarter of FY2025.
Fees and other income grew 18% year-on-year from Rs 20 billion. 1,376 crore in Q2 FY24. 162.2 billion yen in the second quarter of FY2025.
Operating profit increased 21% from Rs 100 crore. 538 billion rupees in the second quarter of FY24. 651.5 billion in the second quarter of FY2025.
Operating expenses increased 18% year over year. 3.87 billion rupees in the second quarter of FY24. 455.3 billion yen in the second quarter of FY2025.
Core operating profit (excluding trading profits) grew by 28% year-on-year from Rs 100 crore. 1,456 million rupees in the second quarter of FY24. 185.7 billion in the second quarter of 2025. Including trading profits, core operating profit increased 30% year over year.
Net profit was down 73% year-on-year, mainly due to higher provisions from the microfinance book and infrastructure charges account. 751 million rupees in the second quarter of FY24. 210 million in the second quarter of 2025.
Excluding additional provisions related to fee accounts and microfinance operations, adjusted profit after tax would have been Rs 20 billion. 626 million
Capital status
The bank was successful in raising Rs. In July 2024, 320 billion yen of new equity capital will flow in from major domestic institutional investors.
The bank also successfully completed its merger with IDFC Ltd in October 2024. The capital stock increased by 618 million shares, but the number of outstanding shares decreased by 16.64 billion shares.
Including Q2 2025 earnings and taking into account the impact of the aforementioned merger, the total CRAR as of September 30, 2024 would be 16.60% and the CET-1 ratio would be 14.08%.
Comments from Managing Director and CEO
V Vaidyanathan, Managing Director and CEO, IDFC FIRST Bank said,
Our core drivers are strong. Our brand, technology and high service levels enable us to significantly increase deposit volumes. The ability to grow deposits is a key strategic strength of the Bank. Deposits grew steadily by 32% compared to the previous year. The CASA ratio remained at 48.9%.
Our overall loan growth remained stable at 21.5% on a year-over-year basis. As seen in other industries, the microfinance business has also seen an impact. Since January 2024, MFI payments are insured by CGFMU. Currently, 50% of the book is insured and is expected to reach 75% by the end of March 2025.
Overall asset quality was broadly stable with gross NPAs at 1.92% and net NPAs at 0.48%. Our PCR improved by 75%.
Created an additional provisioning buffer of Rs. A smart move: investing $315 million in the microfinance sector. The bank has received an additional provision of Rs. 253 crore on one toll road related to Mumbai entry point affected as the state government waived tolls on LMVs. Banks recognize this as profit depending on fee collection and government compensation to customers. This quarter, we disclosed SMA 1+2 ratios and trends by product segment. SMA 1+2 improved quarter-on-quarter, excluding the MFI business.
On the profitability front, core operating profit rose 28% YoY to Rs 20 billion. 1,857 million excluding trading profits.
Our core performance is strong and we are confident that we can return to profitability in the future. ”
