FEDERAL BANK

Indian banking sector’s credit and market liquidity risk predict that the sector is quite resilient and withstood with global economic downturn well. RBI has been working for a long to restructure the domestic banking industry and brought some innovative models like small banks and payment banks. The Indian banking system consists of 12 public sector banks, 22 private sector banks, 46 foreign banks, 56 regional rural banks. India’s digital lending stood at US$ 75 billion in FY18 and is estimated to reach US$ 1 trillion by FY23 driven by the five-fold increase in digital disbursements.

Federal bank is one of the largest commercial banks having more than 1200 branches and 1900 ATMs all over India. The bank has been the first one to make all the branches computerized. The Bank offer its customers, a variety of services such as Internet banking, Mobile Banking, Online bill payment, Fee collection, Depository services, Transaction Banking Services, Merchant banking services, Insurance, Mutual fund products and many more as part of its strategy to position itself as a financial supermarket and to enhance customer convenience. Their target is to deliver its customers more than satisfactory services by providing them with suitable products and services.

The Board of directors has recommended a dividend of Rs. 0.70 per equity share for the year ending 31st March 2021. As per the Q4 results declared, the Federal bank showed a sequential growth of 23.79% in consolidated profit against the previous quarter while the revenue fell by 0.95% against the December quarter. Moreover, PBT increased by 24.06% QoQ and gross profit margin increased by 1.40% QoQ. Also, the assets of the bank grew by 11.78% against the previous year and EPS grew by 72.84% against Q4FY20. 

For the year ended 31st March 2021, the net interest income (NII) stood at ₹1,420.4 crores showing a growth of 16.8% while the asset quality deteriorated as gross non-performing assets (NPA) came at 3.41% against 2.71% in the previous quarter and net NPAs stood at 1.19% against 0.90% QoQ. The CASA ratio for this quarter stood at 33.81%.

The Q4 results of the Federal Bank were pretty staggering.