A key highlight in HDFC Bank Ltd.’s June quarter results, that were reported on Saturday, June 19, was the sharp increase in its provisions on a sequential basis.Provisions for the June quarter increased to ₹14,441 crore, which is higher than the ₹3,193 crore during the March quarter.
The lender, in its notes to account statement, mentioned that it had created a “floating provision” worth ₹9,000 crore, in-line with the board approved policy.
Adjusted for that floating provision, the total provisions at the end of the June quarter would be at ₹5,441 crore, still higher on a sequential basis.”The Bank’s credit performance across all segments continues to remain steady, in a credit environment that remains benign. The Bank has considered this as an opportune stage to enhance its floating provisions, which are not specific to any portfolio, nor meant for any specific anticipated risks, but act as a countercyclical buffer for making the balance sheet more resilient. Accordingly, the bank has made a floating provision of ₹9,000 crore and additional contingent provision of ₹1,700 crore during the quarter,” the lender explained.
The lender, in its notes to account statement, mentioned that it had created a “floating provision” worth ₹9,000 crore, in-line with the board approved policy.
Adjusted for that floating provision, the total provisions at the end of the June quarter would be at ₹5,441 crore, still higher on a sequential basis.”The Bank’s credit performance across all segments continues to remain steady, in a credit environment that remains benign. The Bank has considered this as an opportune stage to enhance its floating provisions, which are not specific to any portfolio, nor meant for any specific anticipated risks, but act as a countercyclical buffer for making the balance sheet more resilient. Accordingly, the bank has made a floating provision of ₹9,000 crore and additional contingent provision of ₹1,700 crore during the quarter,” the lender explained.
HDFC Bank’s core income and net profit were both higher than the CNBC-TV18 poll estimate, while asset quality saw a marginal deterioration, albeit it remained stable. The lender also received ₹10,000 crore as a one-time income as part of its partial stake sale in its non-bank lending arm HDB Financial, during its IPO.
Shares of HDFC Bank ended at the lowest point of the day on Friday, closing 1.6% lower at ₹1,956. The stock has risen only 1.1% in the last one month, and is up 10% so far in 2025.
