LIC HFC Q3 PBT down 13% on a sharp rise in provisions for stressed loans

LIC Housing Finance Ltd's profit before tax (PBT) fell by 13 per cent to Rs 859.59 crore in the third quarter ended December 2019 (Q3Fy20) on sharp rise in provisions for stressed loans.

It had posted a PBT of Rs 745.32 crore in the third quarter ended December 2018 (Q3Fy19).

Its stock closed 4.05 per cent lower at Rs 440.15 per share on BSE.

Net profit for reporting quarter was almost flat at Rs 597.53 crore compared with Rs 596.31 crore in Q3Fy19.

The provisions for expected credit loss stood at Rs 2,584.72 crore as on December 31, 2019 as against Rs 1,555.33 crore as on December 31, 2018. It set aside Rs 390.68 crore for impairment of financial instruments in Q3Fy20 as against reversal of provisions of Rs 3.14 crore in Q3Fy19.

The exposure at default stood at 2.73 per cent as on December 31, 2019 stood as against 2.38 per cent as on September 30, 2019.

Its Net Interest Income (NII) grew by 18 per cent to Rs 1,228 crore in Q3Fy20, as against Rs 1,043 crore Q3Fy19. Net Interest Margin (NIM) for the quarter improved to was 2.42 per cent as against 2.33 per cent in the same period previous year.

The outstanding loan book rose by 13 per cent to Rest 2, 05,692 crore in December 2019 from Rs 1, 81,553 crore a year ago.

The total disbursements were Rs 13,177 crore in Q3 FY20 as against Rs 12,778 crore in Q3Fy19. Out of this, disbursement in Individual Home Loan segment saw a healthy growth of 16 per cent from Rs 9,170 crore to Rs 10,655 crore.

The disbursement of project loans slowed down Rs 931 crore compared with Rs 1,238 crore for the same quarter in previous year, it added.

The capital adequacy ratio stood at 14.37 per cent.

LIC Housing Q3 profit marginally falls to Rs 602 cr on high provisioning

LIC Housing Finance on Thursday reported a marginal fall in consolidated net profit to Rs 602.25 crore in December quarter from Rs 607.29 crore in the year-ago period due to higher provisioning for bad loans.

The consolidated income in the third quarter of 2019-20 rose to Rs 5,006.12 crore, from Rs 4,465.76 crore in same period year ago.

"In the third quarter, there was an increase in NPAs, and so we had to make higher provisioning of Rs 390 crore," LIC Housing Finance MD and CEO Siddhartha Mohanty told reporters here.

On standalone basis, the net profit was almost flat at Rs 597.53 crore during the quarter under review against Rs 596.31 crore in the year-ago period.

Net interest margin in third quarter of 2019-20 stood at 2.42 per cent as against 2.33 per cent during the same period last year.

Net interest income for the three months to December 2019 grew 18 per cent at Rs 1,228 crore, as compared with Rs 1,043 crore in the year-ago quarter.

NPAs in the said quarter increased to 2.73 per cent as against 1.25 per cent in the year-ago period.

The provisions for the period under review stood at Rs 2,584.72 crore as against Rs 1,555.33 crore in third quarter of 2018-19.

During the quarter, total disbursements were at Rs 13,177 crore as against Rs 12,778 crore in third quarter of previous fiscal.

Out of this, disbursement in individual home loan segment grew 16 per cent to Rs 10,655 crore from Rs 9,170 crore a year ago.

"Our focus in the affordable housing segment has led to a healthy growth in the individual home loan segment," Mohanty said.

In the December quarter, the housing finance company disbursed Rs 3,400 crore as loans under the Pradhan Mantri Awas Yojana (PMAY).

Project loans for third quarter of current financial year were at Rs 931 crore compared with Rs 1,238 crore in the year-ago period.

"As far as the disbursement in project loans is concerned, we have continued to be selective considering the overall market conditions," he said.

The cost of funds reduced to 8.22 per cent.

The company raised USD 200 million through external commercial borrowing in the third quarter.

Stock of LIC Housing Finance closed at Rs 440.75, down by 3.92 per cent over previous close.