AU Small Finance Bank: AU Small Finance Bank offers free shares 1:1, 10% dividend to shareholders

Kolkata: AU Small Finance Bank has announced a double benefit for shareholders to mark its fifth year in business while doubling its March quarter net profit to Rs 346 crore on the back of lower cost of funds and increased income basic.

The company’s board of directors has recommended a free issue of one capital share for each capital share held. In addition, the board has proposed a dividend of Rs 1 per capital share with a par value of Rs 10 for FY22. Admittedly, both moves are subject to the approval of shareholders and other statutory and regulatory bodies.

“We are a retail franchise. We wanted to support and attract retail investors as we celebrated our five-year journey,” UA chief executive Sanjay Agarwal told ET.

The dividend will be calculated on equity before bonus.

The bank’s net profit for the March quarter at Rs 346 crore was supported by an 11.4% rise in interest income to Rs 1,667 crore. Net profit was Rs 302 crore in the period a year ago. Its cost of funds fell 88 basis points year-on-year to 5.9%

The quality of its assets improved with a gross ratio of non-performing assets at 1.98% against 2.6% a year earlier. The net NPA stands at 0.5% against 1.29% over the same period.

The bank’s assets under management grew by 27% year-on-year to Rs 47,831 crore, of which about 88% is commercial in nature.

“There was pent-up demand which helped the business grow. I’m also optimistic about growth in the current year despite some headwinds like inflation, the geopolitical crisis and a possible reversal in the currency cycle. easy interest rates,” Agarwal said.

The bank’s deposits increased by 46% to Rs 52,585 crore with a CASA ratio of 37%.

Agarwal said the bank will raise capital this year, but details are yet to be confirmed.

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