IndusInd Bank shares in focus after Q2 update bucks the otherwise strong banking trend

Shares of Mumbai-based private lender IndusInd Bank Ltd. will be in focus on Monday, October 6, as the lender would react to its business update for the September quarter, which it reported after market closing hours last Friday.IndusInd Bank’s net advances declined by 8% during the September quarter to ₹3.27 lakh crore from ₹3.57 lakh crore it reported during the same quarter last year. On a sequential basis, net advances declined by 2%. This it the third consecutive quarter that the lender’s loan book declined on a sequential basis.

The bank’s deposits for the September quarter declined by 5.5% from the same quarter last year to ₹3.89 lakh crore. It had reported deposits of ₹4.12 lakh crore last September. On a sequential basis, deposits also declined by 2%.

CASA Ratio declined by over 500 basis points on a year-on-year basis to 30.8% from 35.9% last year.IndusInd Bank’s retail deposits and deposits from small business customers stood at ₹1.84 lakh crore, which is the same as what it reported during the June quarter.

IndusInd Bank has been in the news all through this year after accounting lapses sent the stock tumbling down to a 52-week low earlier this year. The issue also resulted in its top management quitting and it is only recently, that the board has new CEO Rajiv Anand has taken charge.

The lender’s business update is an outlier in an otherwise strong quarter reported by most of its private and PSU peers. Most of the other banks have seen loans and deposit growth in excess of 10% during the quarter, including state-run lenders.

Shares of IndusInd Bank ended 0.6% higher on Friday at ₹748. The stock has been flat over the last one month.