FINANCIAL RESULTS (INDIAN GAAP) FOR THE QUARTER ENDED JUNE 30, 2017

The Board of Directors of HDFC Bank Limited approved the Bank’s (Indian GAAP) results for the quarter ended June 30, 2017, at their meeting held in Mumbai on Monday, July 24, 2017. The accounts have been subjected to a ‘Limited Review’ by the statutory auditors of the Bank.

FINANCIAL RESULTS:
Profit & Loss Account: Quarter ended June 30, 2017

The Bank’s total income for the quarter ended June 30, 2017 was ` 22,185.4 crore, up from ` 19,322.6 crore for the quarter ended June 30, 2016. Net revenues (net interest income plus other income) increased by 21.7% to ` 12,887.4 crore for the quarter ended June 30, 2017 from ` 10,588.1 crore in the corresponding quarter of the previous year. Net interest income (interest earned less interest expended) for the quarter ended June 30, 2017 grew by 20.4% to ` 9,370.7 crore, from ` 7,781.4 crore for the quarter ended June 30, 2016, driven by average loan growth of 20.7% and a core net interest margin for the quarter of 4.4%.

Other income (non-interest revenue) at ` 3,516.7 crore was 27.3% of the net revenues for the quarter ended June 30, 2017 and grew by 25.3% over ` 2,806.6 crore in the corresponding quarter ended June 30, 2016. The four components of other income for the quarter ended June 30, 2017 were fees & commissions of ` 2,578.1 crore (` 1,977.9 crore in the corresponding quarter of the previous year), foreign exchange & derivatives revenue of ` 296.8 crore (` 314.5 crore for the corresponding quarter of the previous year), gain on revaluation / sale of investments of ` 331.4 crore (` 276.9 crore in the corresponding quarter of the previous year) and miscellaneous income, including recoveries and dividend, of ` 310.3 crore (` 237.4 crore for the corresponding quarter of the previous year).

Operating expenses for the quarter ended June 30, 2017 were ` 5,367.5 crore, an increase of 12.6% over ` 4,768.9 crore during the corresponding quarter of the previous year. The core cost-to-income ratio for the quarter was at 42.7% as against 46.2% for the corresponding quarter ended June 30, 2016.

Provisions and contingencies for the quarter ended June 30, 2017 were ` 1,558.8 crore (consisting of specific loan loss provisions ` 1,343.2 crore, general provisions ` 206.3 crore and other provisions ` 9.3 crore) as against ` 866.7 crore (consisting of specific loan loss provisions ` 832.3 crore, general provisions of ` 1.1 crore and other provisions ` 33.3 crore) for the corresponding quarter ended June 30, 2016. General provisions include additional provisions of ` 121.1 crore for standard advances to stressed sectors. Profit before tax was up 20.4% to ` 5,961.2 crore. After providing ` 2,067.3 crore for taxation, the Bank earned a net profit of ` 3,893.8 crore, an increase of 20.2% over the quarter ended June 30, 2016.

Balance Sheet: As of June 30, 2017

Total balance sheet size as of June 30, 2017 was ` 895,653 crore as against ` 755,631 crore as of June 30, 2016.

Total deposits as of June 30, 2017 were ` 671,376 crore, an increase of 17.0% over June 30, 2016. CASA deposits saw healthy growth with savings account deposits growing by 26.5% over the previous year to reach ` 193,105 crore and current account deposits growing by 34.1% over the previous year to reach ` 102,030 crore. Time deposits were at ` 376,241 crore, an increase of 9.1% over the previous year, resulting in CASA deposits comprising 44.0% of total deposits as on June 30, 2017.

Advances as of June 30, 2017 were ` 580,976 crore, an increase of 23.4% over June 30, 2016. As per regulatory [Basel 2] segment classification, retail loans grew by 21.9% and wholesale loans grew by 25.5% (as per internal business classification, the growth was 19.2% and 33.8% respectively). The loan mix between retail:wholesale was 54:46.

Capital Adequacy:

During the quarter ended June 30, 2017, the Bank raised Additional Tier 1 Capital Bonds of ` 8,000 crore and Tier 2 Bonds of ` 2,000 crore. The Bank’s total Capital Adequacy Ratio (CAR) as per Basel III guidelines was at 15.6% as on June 30, 2017 (15.5% as on June 30, 2016) as against a regulatory requirement of 10.25% including Capital Conservation Buffer of 1.25%. Tier-I CAR was at 13.6% as of June30, 2017 compared to 13.3% as on June 30, 2016. Risk-weighted Assets were ` 690,370 crore (` 551,676 crore as on June 30, 2016).

NETWORK

As of June 30, 2017, the Bank’s distribution network was at 4,727 branches and 12,220 ATMs across 2,666 cities / towns as against 4,541 branches and 12,013 ATMs across 2,593 cities / towns as of June 30, 2016. Of the total branches, 52% are in semi-urban and rural areas.

ASSET QUALITY

Gross non-performing assets were at 1.24% of gross advances as on June 30, 2017, as against 1.05% as on March 31, 2017, and 1.04% as on June 30, 2016. During the quarter ended June 30, 2017, of the total increase in gross NPAs, 60% pertained to the agricultural segment. Recoveries from agricultural advances were impacted during the quarter by borrower expectations of farm loan waivers arising out of policy announcements in certain states. These loan waiver policies are in the process of being finalised and implemented. As a prudent measure, the Bank has enhanced specific provision coverage for its non-performing agricultural advances. Net non-performing assets were at 0.4% of net advances as on June 30, 2017.

Note:
` = Indian Rupees
1 crore = 10 million
All figures and ratios are in accordance with Indian GA