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Kotak Mahindra Bank, a leading private sector lender in India, announced strong financial performance for the second quarter of fiscal year 2025 (Q2FY25), reporting a 5% year-on-year (YoY) increase in standalone profit after tax (PAT) to Rs 3,344 crore. This growth was driven by a healthy increase in net interest income (NII) and a positive trend in deposits. The bank's NII for the quarter jumped 11% YoY to Rs 7,020 crore, demonstrating the bank's ability to capitalize on growth opportunities in the market.
While the bank's net interest margin (NIM) dipped slightly to 4.91% in Q2FY25 from 5.22% in the corresponding period last year, this can be attributed to factors like increased competition and regulatory changes. However, Kotak's asset quality remained resilient, with gross non-performing assets (GNPA) rising marginally to 1.49% from 1.72% YoY. Similarly, net NPA also saw a slight increase to 0.43% from 0.37% YoY. The bank's strong capital position is evident in its robust capital adequacy ratio, which stood at 22.6% as per Basel III norms, and a CET1 ratio of 21.5% (including unaudited profits).
Kotak's deposits continued to grow at a healthy pace, expanding 16% YoY to Rs 446,110 crore. The bank's CASA (current and savings account) ratio also improved sequentially to 43.6% in Q2 from 43.4% in Q1, indicating a shift towards low-cost deposits. Simultaneously, advances saw a 17% YoY increase to Rs 419,108 crore, signaling strong loan growth driven by the bank's focused lending strategy. On a consolidated level, Kotak's PAT rose 13% YoY to Rs 5,044 crore, demonstrating the positive contribution of its subsidiaries, including Kotak Securities and Kotak Mahindra AMC.
Kotak Securities' PAT improved to Rs 324 crore in Q2FY25 compared to Rs 400 crore in Q2FY24, although its market share dipped slightly to 11.6% from 12.2% YoY. Kotak Mahindra AMC witnessed a significant increase in PAT, reaching Rs 197 crore in Q2FY25, compared to Rs 124 crore sequentially, with its AUM expanding by 37% YoY to Rs 680,838 crore. These strong performance metrics by the bank and its subsidiaries solidify Kotak Mahindra Bank's position as a leading financial institution in India, positioned for continued growth and expansion.
Source: Kotak Mahindra Bank Q2 Results: PAT rises 5% YoY to Rs 3,344 cr; NII jumps 11%