ESAF Small Finance Bank FY21 net profit dives 45% to Rs 105.40 crore

Thomas expects that slippages in FY22 would remain under control in the range of 3-4%.

ESAF Small Finance Bank (SFB) on Wednesday reported a 44.64 % year-on-year decline in its FY21 net profit to Rs 105.40 crore, mainly due to higher provisions. The Thrissur-based lender had posted a net profit of Rs 190.39 crore in FY20.

The bank reported gross NPA ratio at 6.70% and net NPA at 3.88% for the fiscal 2020-21.

MD and CEO K Paul Thomas said due to a severe crisis at the grassroots level because of the pandemic, the collection efficiency was adversely impacted. The bank, as a prudent measure, holds provision in excess of the RBI requirement in the standard category to the extent of Rs 91 crore as of March 31, 2021, he added. Provision Coverage Ratio is reported at 52.77%.

The bank was launched in March 2017 and it became a scheduled bank in December 2018.

The operating profit increased from Rs 324.70 crore in FY20 to Rs 415.84 crore in FY21.Total business registered growth of 25.85% from Rs 13,846 crore for the year ended March 31, 2020, to Rs 17,425 crore for the year ended March 31, 2021.

“The bank has improved its operating profit and total business despite the challenges posed by the pandemic. With the support of our customers and their unwavering faith in us, we could also enhance our presence across the country. The reduction in the PAT was mainly due to the higher provisions during the fiscal,” Thomas added.

Deposits have grown 28.04% from Rs 7028 crore as of March 31, 2020, to Rs 8999 crore for the fiscal year ended March 2021. Total CASA improved to Rs 1748 crore from Rs 960 crore, marking 81.99% growth over the same period.

During the year the bank has raised Tier I capital amounting to Rs 162.59 crore by way of a private placement. This along with the current year’s profit improved the CRAR by 20 bps from 24.03% as at March 31, 2020, to 24.23% as of March 31, 2021, despite the increase in business, bank sources said.