InvestorQ : Why has the shares of RBL Bank fallen so sharply on 29 October?
Archita Jajjoo made post

Why has the shares of RBL Bank fallen so sharply on 29 October?

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Niti Shenoi answered.
2 months ago
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On Friday ,the stock of RBL Bank fell sharply by nearly 15% to Rs.172 after the bank reported disappointing numbers. For the Sep-21 quarter, the PAT was down 95% at Rs.31 crore due to a combination of higher provisions and weak net interest income. The bank had posted a steep loss of Rs.459 in the first quarter ended June 2021. This steep fall in the bank stocks has meant that it has corrected nearly 37% from its recent peak.

In the Sep-21 quarter, the net interest income or NII contracted by 2% to Rs.915 crore. The net interest margins or NIMs also came down from 4.36% to 4.06% on a sequential basis. The micro banking portfolio of RBL Bank came under a lot of pressure despite the corporate banking portfolio picking up sharply in the quarter. This led to a sharp dent on the profitability of the company.

The bigger hit was on the asset quality front. Gross NPAs spiked by 41 bps to 5.14% while the net NPAs also ended up higher. The gross NPAs are up by nearly 200 bps on a yoy basis showing intense pressure on account of COVID related asset quality pressures.

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