Indian lender Axis Bank misses Q3 profit view as higher provisions weigh
India's Axis Bank reported a smaller-than-expected rise in third-quarter profit on Thursday, as it set aside more funds for potential bad loans amid a slight deterioration in asset quality.
The country's fourth-largest private lender by market capitalisation said its standalone net profit - which excludes earnings of its subsidiaries - rose 4% to 63.04 billion rupees ($728.48 million) for three months to December-end.
Analysts had expected, on average, a profit of 65.16 billion rupees, according to estimates compiled by LSEG.
The lender's provisions and contingencies, or funds kept aside for potential bad loans, more than doubled year-on-year to 21.56 billion rupees.
Indian lenders have been grappling with higher bad loans in segments such as microfinance and in the unsecured portfolio, forcing them to set aside more funds for potential bad loan losses and to strengthen their balance sheets.
Axis Bank's gross non-performing assets ratio, a key gauge of lenders' asset quality, was at 1.46% at the end of December, compared with 1.44% three months earlier.
Net interest income - the difference between interest earned and paid - rose around 9% to 136.06 billion rupees, as per Reuters' calculations.
($1 = 86.5350 Indian rupees)
