YES Bank reported a 65% rise in standalone net profit to ₹1,080 crore in the September quarter, helped by higher interest income and lower provisions. However, the recent Supreme Court ruling on AT-1 bonds could create a potential proforma loss of ₹5,217 crore.
Mumbai, October 18 — YES Bank reported a 65% year-on-year increase in standalone net profit to ₹1,080 crore for the September quarter, compared with ₹654 crore in the same period last year.
The profit was also above Bloomberg’s estimate of ₹1,009 crore.
The bank’s net interest income rose 22.7% to ₹2,822 crore, while other income increased 14.4% to ₹1,882 crore. Operating profit climbed 29.4% to ₹1,678 crore.
Provisions and contingencies declined 24.2% to ₹317 crore, from ₹419 crore a year earlier, supporting the sharp rise in profit.
Asset quality also improved. The bank’s gross NPA ratio declined to 1.2% from 1.3% in the previous quarter, while net NPA remained unchanged at 0.2%.
YES Bank’s advances grew 23.7% year-on-year to ₹3.09 lakh crore as of September-end.
Deposits increased 19.5% year-on-year and 12.2% sequentially to ₹3.54 lakh crore, helped partly by FCNR(B) mobilisation of ₹18,575 crore.
Excluding foreign-currency term loans linked to FCNR(B) deposits, credit growth stood at 17.6%. The bank’s CASA ratio declined to 30% from 33.7% a year earlier.
However, the bigger concern for the bank comes from the Supreme Court’s October 15 ruling on additional tier-1 bonds.
The court upheld the Bombay High Court’s decision that set aside the write-down of ₹8,415 crore worth of AT-1 bonds carried out during YES Bank’s reconstruction in March 2020.
YES Bank said it has not yet recognised the potential financial impact of the judgment in its reported quarterly results because it is still assessing the legal, accounting and implementation implications.
According to the bank’s indicative proforma calculations, if the estimated impact were recognised, the reported quarterly profit of ₹1,080 crore would turn into a loss of ₹5,217 crore.
For the first half of FY27, the reported profit of ₹2,151 crore could turn into a loss of ₹4,146 crore.
The bank’s net worth could also decline by ₹6,298 crore to ₹46,970 crore, while borrowings could rise to ₹86,149 crore from ₹77,734 crore.
Despite this, the bank said its capital adequacy ratio would remain unchanged at 14.5% under the proforma calculations.
YES Bank has said it is consulting legal advisers and evaluating available legal remedies, including possible further proceedings before the Supreme Court.
