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AU Small Finance Bank Shares Lower After Q4 Results

Shares of AU Small Finance Bank fell 4% after fourth-quarter results.

Shares of AU Small Finance Bank were down 3.5% in morning trade on April 26, even though it posted its highest quarterly profit of Rs 425 crore in Q3FY23, up 23% YoY. The bank posted a net profit of Rs 346 crore in the same period last year.

The stock was trading down 3.14% at Rs 639 at 9:45 am on the National Stock Exchange. The Jaipur-based lender will post a net profit of Rs 1,428 crore for the fiscal year 2022-23, up 26% from the previous year, the bank said on April 25.

Its asset quality has improved, with a total non-performing asset ratio of 1.66% in the quarter, compared with 1.98% in the third quarter of FY22. Net NPA accounted for 0.42% of net advances in March 2023, compared to 0.50% in the same period last year.

The bank’s 2022-23 NIM is maintained at 6.1% (including nomination/securitization book). Its balance sheet rose 31% year-on-year to Rs 90,216 crore, with deposits up 32% to Rs 69,365 crore.

“Amid a difficult market, we have increased our deposit book while keeping our CASA ratio stable and making our deposits more granular and retail. Our asset quality has also improved further this year with net NPA down to 0.4%,” Sanjay said Agarwal, MD and CEO of AU Small Finance Bank.

The bank’s total capital adequacy ratio was 23.6%, above the minimum requirement of 15%, with Tier 1 capital at 21.8%, above the minimum requirement of 7.5%.

The board of directors recommends a dividend of Re 1 per share (10% of face value) for the year ending March 2023.

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