Axis Bank Reports Net Loss of Rs. 5,728 Crore in Q4 Due to Citibank Acquisition
Axis Bank, a leading private sector lender in India, announced its financial results for the fourth quarter of FY 2021-22. The bank reported a net loss of Rs. 5,728.42 crore in Q4, primarily due to the acquisition of Citibank India’s consumer business. However, if the one-time hit on account of the deal is excluded, the bank posted a net profit of Rs. 6,625 crore in Q4, a 61% YoY growth.
Citibank Acquisition Impacts Axis Bank’s Quarterly Results
The acquisition of Citibank’s retail business had a significant impact on Axis Bank’s quarterly results. The bank accounted for non-recurring items totaling Rs. 12,490 crore related to the Citibank acquisition and charged them to the profit and loss account in Q4, reporting them as extraordinary items. The Managing Director and CEO of Axis Bank, Amitabh Chaudhary, acknowledged the impact of the acquisition on the quarterly results. However, he stated that if the transaction amount is excluded, the net profit of the bank has increased by 61% YoY.
Net Interest Income Increases by 33%
Despite the loss incurred due to the Citibank acquisition, Axis Bank’s net interest income (NII) grew by 33% YoY to Rs. 11,742 crore. The bank’s net interest margin (NIM) also increased by 0.73% to 4.22%. Additionally, the advances increased by more than 20%, while income from other sources increased by 16% to Rs. 4,895 crore during the quarter.
Axis Bank Board Approves Proposal to Raise Rs. 35,000 Crore
The board of directors of Axis Bank has approved a proposal to raise Rs. 35,000 crore through various means. This move is expected to help the bank strengthen its balance sheet and capital adequacy ratio.
Axis Bank’s Outlook for the Future
Despite the challenges faced by Axis Bank in Q4, the bank remains optimistic about its future prospects. The Managing Director and CEO, Amitabh Chaudhary, stated that the bank has a strong balance sheet and capital position, which will enable it to navigate any challenges in the future. He also expressed confidence in the bank’s ability to grow its loan book and improve asset quality.
Conclusion:
Axis Bank’s Q4 results were impacted by the Citibank acquisition, but the bank remains optimistic about its future prospects. With a strong balance sheet and capital position, Axis Bank is well-positioned to navigate any challenges in the future and grow its loan book.
