HDFC Bank India
HDFC Bank's Q1 net profit up 20.15% on higher interest and fee income. In Picture: The headquarters of India's HDFC bank is pictured in Mumbai, India, Dec.4, 2015.Reuters File

HDFC Bank, India's second largest private sector lender, reported a 20.15 percent rise in net profit to Rs. 3,239 crore in the first quarter of financial year 2016-17. It had posted a net profit of Rs. 2,695 crore in the corresponding quarter last fiscal.

The bank noted that the year-over-year rise in net profit was on account of higher interest and fee income. Its total interest earned was Rs.12,511 crore, up from Rs. 10,525 earned in June quarter last year, while income from investment was Rs. 3,809 crore against Rs. 3,281 crore. The increase was 18.86 percent and 16.09 percent, respectively.

The Mumbai-based bank's net interest income increased 21.8 percent to Rs. 7,781 crore in the June quarter from Rs. 6,388 crore seen a year earlier (Net interest is the interest earned on loans minus the interest given on deposits).

HDFC's total income was up 17.08 percent to Rs. 19,322 crore from Rs. 16, 502 crore in June quarter of FY 2015-16. The bank's non interest bearing revenues too grew 14 percent to Rs. 2,806 crore.

Gross nonperforming assets (NPAs) of the bank increased to 1.04 percent of the total loans from 0.95 percent registered in a year ago period. As of june 30, the bank's net NPA was 0.3 percent of net loans serviced.

The provisioning for the bad loans in June quarter increased 19.06 percent to Rs. 866 crore from Rs. 727 crore allotted a year ago.

The bank's capital adequacy ratio (CAR), which measures a bank's capital as against its risks and liabilities, was 15.5 percent this quarter. HDFC Bank shares traded at Rs. 1230 apiece on the Bombay Stock Exchange at 1.30 pm IST, down by 0.17 percent.

As bank's profitability has taken a hit from increasing provisions on seemingly stressed assets too, HDFC Bank noted that its asset quality trend was steady for the June quarter.