Federal Bank Limited is a listed company on both the premier exchanges in the country namely NSE and BSE. It has posted its Q1 (2018-19) results. A few highlights of the performance of the bank are given below:

1. During the Q1, Rs. 461 cr slipped into the NPA (Non Performing Asset) net. This indicator is better than expectations and shows a more dependable growth of a loan book of the bank. As a result, the NPA percentage reduced to 2% from the earlier 2.28%.

2. Net Profit for the quarter rose by 25% to Rs. 263 cr. This 25% increase is over the same quarter previous year (this term is also known as y-o-y. This also means the comparison is not with the last quarter but with the same quarter during the last financial year).

3. Net Interest Income (NII) which is difference between Interest Earned on the Loans (assets) and Interest Paid on the Deposits (liabilities) showed 22% growth y-o-y.

4. Loan Book (assets) grew by 22% y-o-y. This is a healthy growth in the current times. All the three arms of lending namely, Retail, SME and Corporate participated almost equally.

5. Interest earning is the primary source of earning for the bank. Net Interest Margin (NIM) which is the difference between average rate of interest charged on loans (assets) and average rate of interest paid on deposits (liabilities). In Federal Bank Limited Q1 performance, this margin was maintained at 3.2%. falling cost of deposits helped here. In simple terms, if the bank charged on its average loan a rate of interest of 10.2% per annum, it paid to an average depositor an interest at 7% per annum.

6. There is a secondary source of earning or income for the bank: Non Interest Income. Some avenues of non interest income are Fees, Commission, Discounts, Charges and Penalties. This category of income grew by 16% during this quarter.

7. Similarly, an outflow of income can also happen by way of provision (money set aside for meeting the impact of bad loans). This declined a bit adding a positive impact to profits.

8. The bank has 1.9% share in the Indian banking sector’s incremental deposits and loans. This is an improvement.